Free UTOPIA!

I attended the Midvale city council meeting tonight and the city council unanimously approved the new bonds for UTOPIA by a 5-0 vote, much to the dismay of many of those in attendance. I know I was somewhat ambiguous about the new bonds but after the presentation by Kirk Sudwicks (?), I knew they had put together a solid plan with high odds of success. The city council realized it too and I could tell they'd done their homework when they later explained their votes. Kudos for them to being willing to do what they thought was right in the face of so much hostility (and a fair number of folks speaking out of order). 

Payson, meanwhile, rejected the new bonds by a 4-1 vote. This came as a surprise as it was expected as recently as last week that they would pass the new bonds. Word on the street is that the Utah Taxpayers Association launched a blitz on their city council to talk them out of it. Payson residents, there's still time to talk to the council and have them reconsider the motion. I know that once I get a chance, I'll be opening a dialog with each of them to find out why they rejected it.

I haven't seen anything on the five other cities voting on the bond issue tonight, but I'll be sure to post more as it hits the newswire tomorrow. 

A surprisingly accurate story from the Deseret Morning News (no, really) reveals further details on UTOPIA's current build progress. Here's a list of the current completion per city:

• Lindon: 95-99%
• Payson: 95-99%
• Tremonton: 95-99%
• Perry: 50%
• Orem: 50%
• Murrary: 50%
• Midvale: 40%
• Brigham City: 33%
• Centerville: 25%
• Layton: 15%
• West Valley City: 15%

We also get some more critical details on the financial picture. With the current 7,000 subscribers, UTOPIA is currently covering operating costs. Given the two-year reprieve from bond payments under the new bonding plan, UTOPIA will have plenty of time to wrap up construction in the current Phase I and Phase II cities and boost subscriber numbers to the point where covering the debt service won't be an issue.

So how about the benefits already realized by UTOPIA users? Orem is saving $600,000 per year in telecommunications costs, a sizable chunk of the money they pledged for UTOPIA. Print Advantage of Lindon went from ferrying around large files on portable hard drives to having customers directly upload them over their shiny new 10Mbps connection, a connection that cost just 60% of what they paid for a T-1 line at about 1/7th of the speed. Laura Lewis, a member of the firm that handles UTOPIA's finances, downloads movies from iTunes 60 times faster than her friend in Sandy.

As more details come out, the future for UTOPIA looks bright indeed. Let's hope that the city councils in member cities see it the same way when voting on the rebonding. 

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.

After the train wreck of sloppy reporting from The Tribune, it's nice to see a news article that, you know, gets the story right. The Clipper has rightfully pointed out that cities always were prepared for the worst-case scenario, paying for the bonds with tax money, and that nobody has been expecting a slam-dunk free lunch. Officials from Layton and Centerville seem comfortable with where the project is and, given the high stakes, that speaks volumes.

Of great interest is a re-working of the model from PacketFront, the company that acquired DynamicCity last year. They bring a lot of experience to the table and have done a thorough top-to-bottom re-evaluation of the current way of doing business. Hopefully this will improve UTOPIA's abysmal policies concerning advertising and publicity, something that has left take rates low since most potential customers hadn't even heard of the project. The details are scarce right now so we don't have much to go on.

Another juicy tidbit: apparently Vineyard voted to become a non-pledging member in December, something that went largely unreported. 

Warren Woodward, director of broadband services at XMission, got an opinion piece published in the Tribune that helps set the record straight on their one-sided article and op-ed lambasting UTOPIA. Take some time to go check it out.

FCC Chairman Kevin Martin seems to not be in the business of making friends lately. Despite talking tough on "a la carte" stations and cable conglomerates, he's failed to make much headway with fellow members of the commission or members of Congress. His goal? To treat cable operators like phone companies by giving them "common carrier" status. It doesn't seem to far-fetched given how they do a lot more than pipe in HBO and Food Network these days.

There is, however, a bit of cynicism floating around. Some have openly wondered if Martin is playing to the telco's advantage. Given that they've been rescinding open access for competitors and removing the caps on fees they can be charged, those accusations seem to stick. Sounds like the balance of power is indeed swinging. Not from huge telco giants to consumers, but from cablecos to telcos.

Verizon shook the industry with a move to 20Mbps synchronous connections. UTOPIA rocked it further by allowing providers to ramp up to 50Mbps. Now the entire cable industry has gone nuts trying to ramp up speeds in short order during Q4.

Insight Communications and Cox Communications have each decided to jump to 20Mbps downloads, albeit in limited markets and to a limited number of subscribers. Charter is rumored to be working on a 16Mbps/2Mbps tier coming Real Soon Now(TM). Charter is making their jump by using a technology called SDV that works in a fashion similar to AT&T's U-Verse. Instead of sending all television channels down the pipe at a time, it only sends the channels being actively watched. This helps conserve major bandwidth for more channels and faster speeds. Cox, meanwhile, is doing a lot more than just using SDV. They've also added a big slice of bandwidth to their transceivers and are planning to build their own backbone using some of Level 3 Communications' dark fiber.

This doesn't mean that Verizon is standing still. They've found a way to reliably send 100Gbps over a single strand of fiber and are talking about jumping to 200Mbps for their existing FIOS customers. (They're also rumored to be looking at forcing people onto FIOS to be able to get rid of their old copper/DSL infrastructure. Boo.)

In all of this, though, you're not likely to get what you think you're paying for. That clever "up to" phrase means you could experience congestion at any point from your neighborhood node to the exchange points on the cable company's carrier. Also don't forget that allowing you to use anywhere from 20-200Mbps without a cap can get real expensive for your ISP. Make sure you keep a close eye on those contracts to watch for limitations and caps.

In the wake of Comcast's throttling, er, "delaying" of BitTorrent connections, it seems like all hell has broken loose for the mammoth cable operator. Not only are they facing lawsuits, consumer complaints to the FCC and some seriously peeved members of Congress, but they'll also have to contend with a re-energized network neutrality debate.

Throughout the whole process, Comcast has made itself look worse and worse. First they denied. Then when the AP caught them, they tried to spin it and claim that they were "delaying" instead of outright blocking. Then when an internal memo got leaked detailing their official policy, they started on a witch-hunt to find and terminate the responsible employee. So to recap, Comcast thinks that good PR consists of deny, spin, fire whomever talked. It's a Reality Distortion Field™ that would make Steve Jobs proud.

Since the story broke, Wall Street has been pounding the company, sending their stock price to a 52-week low. Even prior to their dismal earnings report on the 25th, the stock had already dropped about 25% from it's 52-week high. What's to blame? Probably their poor customer service driving customers away to services like Verizon's FIOS and a lack of dial-up customers to continue their growth. Industry observers have said it's time for them to start dropping prices, but that doesn't jive with their plans to jack up television rates even higher.

Do you hear that, Comcast? That is the sound of inevitability. That is the sound of your irrelevance. 

The FCC is expected to hand down some new rules on Wednesday to ban exclusive provider contracts in apartments, condos and other multi-unit dwellings. This is a reaction to cable rates that have jumped 93% in the last decade. FCC Chair Kevin Martin noted that cable rates often drop 30% or more when a second provider enters a market, proof positive that monopolies are bad for consumers.

Not only is this great news for those residents, it's also great news for UTOPIA. Part of their problems with expansion have been centered around complexes locked into these contracts who are unwilling to allow installation while the contracts are still in effect. With a ban on such arrangements, UTOPIA would be free to expand at a much faster rate.

The rumor mill at DSL Reports says that UTOPIA residential connections will be beefed up to 50Mbps in both directions. That means downloads at least 7 times faster than cable or DSL and uploads over 60 times faster. The price? Still $40 a month as always. Even though the speeds are being upped, you still have a 100GB per month cap on transfer. Obviously no ISP is going to stay in business if they give you a truly all-you-can-eat experience with bandwidth greater than a DS3. There's no word on where commercial connections are going, but I'm expecting somewhere in the 100Mbps range.

So where's the bottleneck now? Probably in the crappy router sitting on your desktop. Most home products from Linksys, D-Link, Netgear and other manufacturers only have a 10Mbps port for the WAN connection. Most of the ones with a 100Mbps WAN can barely muster 14-15Mbps through the port. Your options are to either upgrade to a high-end router (models with a 1Gbps port sustaining 250Mbps can run $200 or more) or build your own Linux-based router. I'll write up some more later so you'll have some idea where to go when your hardware fails to keep up with your connection.