To that end, I’m issuing an open challenge to the Utah Taxpayers Association. You find your best guy, name a time and place, and we’ll have the knock-down, drag-out debate over UTOPIA that you’ve been avoiding for years. I know you’re reading and I know you’ll see this. I also know you’re probably too chicken to accept the challenge or risk getting your nose bloodied in a public forum. I’m extending it anyway to give you the opportunity to prove me wrong.

So bring it. I’m ready.

Greetings Sen. Niederhauser and Rep. Beck;

As you may have heard, Google has offered to build a fiber optic network similar to UTOPIA designed to reach from 50,000 to 500,000 households. They are currently accepting proposals from municipalities and individuals in order to determine where they should build. The website with additional information and links to the applications is available here: http://www.google.com/appserve/fiberrfi/

It would be absolutely incredible if Google decided to come to Utah to partner with or compliment UTOPIA’s efforts to improve our state’s critical telecommunications infrastructure. It would bring significant investment into the state and thousands of new jobs. I know you both likely have your hands full during this legislative session, but it would be very helpful if either or both of you would sponsor a resolution in favor of Google’s participation in our state and/or pass this along to the appropriate agencies within the executive branch. Google is only accepting proposals and nominations through March 26, so time is of the essence.

Thank you for your time and consideration. If you have questions about telecommunications or what Google is doing, please feel free to call or e-mail me.

While legislators are very busy people, especially as they consider how to balance the state budget, it can’t hurt to sent a short and concise e-mail urging them to adopt and pass such a simple resolution. If you don’t know who your legislators are, you can find out from the Utah Legislature website. You can also consider contacting your county government officials as well; the more support, the better!

UPDATE: Here’s the letter published in the Tribune.

Whenever there is criticism leveled towards UTOPIA, you will usually find the Utah Taxpayers Association screaming the loudest. The irony is that they are one of the least-qualified to criticize UTOPIA or make any commentary on telecommunications policy.

For starters, they deny that there is a serious telecommunications problem in our nation. The United States has been slipping in OCED rankings of broadband speeds, availability, and pricing for over a decade, now surpassed by Latvia, a former Soviet Bloc country, in all of those metrics. The telecommunications sector regularly gets some of the worst rankings in the quarterly American Consumer Satisfaction Index. Comcast only recently “lost” last place to Charter Communications in the cable category, a company that has declared bankruptcy in the midst of poor technical and customer service. To deny there is a problem is to deny reality.

The UTA is also very selective about what kinds of “unfair competition” they choose to speak out on. They make a lot of noise about using tax dollars to fund telecommunications systems and bemoan that such entities do not pay franchise fees or property taxes. You will not, however, hear equal outrage about the abuses of the Universal Service Fund by incumbent telephone carriers, the numerous equipment depreciation tax benefits enjoyed by Qwest, or the onerous build-out requirements imposed by cities at the behest of Comcast. Apparently the UTA is okay with private companies getting lots of government benefits, but not with government doing it on its own.

None of this should be too surprising as the UTA acknowledges that Qwest and Comcast are dues-paying members. Despite being asked, UTA representatives refuse to disclose just how much of their operation is funded by these UTOPIA foes nor the level of input they have in editorial content. For all we know, the UTA is a de facto front for doing the dirty work of incumbents.

This is probably why the UTA will not and cannot provide any concrete proposed solutions of its own. Whenever asked, the best they can come up with is a vague “let the free market reign”. I’m sorry, UTA, but there is no free market. We have a government-sanctioned and supported system of incumbent protection that fleeces taxpayers, stifles competition, and discourages network investment. You are no friend to the taxpayer, and you are completely unqualified and non-credible in these matters.

Jesse Harris is a software implementer in Sandy. He writes in support of municipal telecommunictions at FreeUTOPIA.org.

Way back on September 17, I sent the following e-mail:

Hello,

I’m curious to know what state entity will be responsible for reviewing BTOP
applicants and applications, specifically in the state of Utah. Please
advise.

Just today, I get the following response:

Thank you for your interest in Broadband Technology Opportunity Program (BTOP). The BTOP application process encourages collaboration with the states in order to identify and fund the best possible broadband projects in America.  A representative from a state may contact an applicant to request additional information contained in the application because of the state’s interest in making a recommendation to NTIA. Promptly replying to a state’s request allows the representative to carefully consider applications before commenting to NTIA.  As a reminder, all Round 1 grant awardees will be determined by the end of the year.

Again, we appreciate your interest in the BTOP program to help bridge the technological divide and create jobs by expanding access to broadband throughout the nation.

Best Regards,
BTOP Team

There’s a few very glaring problems with what just happened here.

1. The response is a canned form letter with no relevance whatsoever to the question asked.
2. The response came 5 weeks after the original e-mail was sent.
3. There is no longer an opportunity to communicate with the relevant persons at the state level because the deadline for their review has now passed.

Is this really the best that the NTIA can do? If so, I doubt we’re going to see any kind of meaningful federal effort to improve telecommunications infrastructure in this country.

UTOPIA Executive Director Todd Marriott has announced the formation of the UTOPIA Citizens Advisory Network (U-CAN) to help provide feedback from the public on the direction UTOPIA is going. Jesse Harris, a local activist who runs FreeUTOPIA.org, has been selected to chair the new group. Harris has spent significant time and effort following developments related to UTOPIA since September of 2006. “Our goal is to help spread the word about UTOPIA and provide ideas on how the network can improve,” he said. He continued: “I’m very excited to bring the community of municipal telecommunications supporters together so that we can help make this network succeed.”

U-CAN plans to hold its first meeting on Saturday June 28 from noon until 1:30PM at the Ruth Vine Tyler Library, 8041 S Wood Street in Midvale. A representative from UTOPIA will be on hand to answer questions from meeting attendees. Regular monthly meetings will be scheduled across the Wasatch Front to give residents of all member cities an equal chance to participate.

About UTOPIA: UTOPIA is a consortium of 16 Utah cities that provides a next-generation fiber optic network for providers of telecommunications services and provides some of the fastest Internet speeds in the nation. It promotes a competitive marketplace by allowing smaller private companies to lease the network and provide services to residents within its service area and is open to allowing new providers and services on the network.

About Jesse Harris: Mr. Harris is an IT professional from White City Township and activist for municipal fiber optic networks. He has been blogging about municipal fiber optic projects and telecommunications at FreeUTOPIA.org since September of 2006. He is a recognized authority on municipal telecommunications projects in Utah and has been interviewed about UTOPIA and iProvo by the Salt Lake Tribune, Deseret News, Salt Lake City Weekly and Daily Herald. 

Greetings Members of the Council;

I apologize for the last-minute nature of this communication. I've been waiting to collect as much information as possible before I e-mail you important information on why Broadweave is the wrong company to sell iProvo to.

Certainly basic honesty seems to be an issue with Broadweave. As of May 15, they have neglected to obtain business licenses in any municipality where they do business. Washington City has considered referring the matter to enforcement. (See: http://www.freeutopia.org/2008/05/15/broadweave-lacks-proper-business-licenses-corporation-filings/) They also have repeatedly misrepresented their company's age, claiming to have existed since 1999, yet nothing shows that the company existed prior to 2003. In an interview today, Steve Christensen, Broadweave's CEO, is now claiming the company has been around since 2003. Why the lie? (See: http://www.freeutopia.org/2008/05/16/broadweave-did-not-exist-prior-to-2003-website-claims-first-contract-in-1999/
and http://www.freeutopia.org/2008/06/02/broadweave-doubletalks-iprovo-on-couchcast/) They have also talked up the importance of equipment ownership and the poor value of open networks while failing to practice what they preach. (See: http://www.freeutopia.org/2008/05/19/broadweaves-double-talk-on-open-networks/ and http://www.freeutopia.org/2008/05/20/broadweaves-double-talk-on-equipment-ownership/) It is even rumored that they have tax liens filed against them by the state for failure to pay their withholding taxes for November and December of 2007. (See: http://www.freeutopia.org/2008/05/16/evaluating-the-iprovo-asset-purchase-agreement/#comment-4887) Can you really trust a company that shows so many signs of being untrustworthy?

This says nothing of their expansion plans either. The Eagle Broadband network they have purchased in Houston was a seriously distressed asset. In order to make it usable, they need to build a NOC, negotiation franchise agreements and transport rights and replace some vital missing equipment. They also need to overcome a negative consumer perception. At the time that OEN, the previous network operator, went out of business, there were 1500 customers, all of whom lost their service with zero notice. That kind of poor experience means they will be plowing millions upon millions into a network with a strongly negative customer perception. This says nothing of their attempt to pursue developments in Nevada, Arizona, New Mexico and California, pursuits that will require even more money that they do not have.

So what of their technical experience? While Veracity brings in a lot of smart guys, Broadweave itself has zero experience delivering video in Traverse Mountain and has fewer than 30 video customers in Sienna Hills, a subdivision sitting in one of the areas hardest-hit by the subprime mortgage meltdown. Integrating the Veracity team, one that offers very limited video experience, will take months and result in major system hiccups. They will also have to attempt to integrate city employees from the NOC, many of whom are highly opposed to the transaction and have negative opinions of their soon-to-be co-workers. Replacing these highly-skilled employees will be very expensive and have a strong negative impact on network operations, especially in Utah's tight labor market.

The option you are presented with is a terrible one, to spend 19 years financing the operations of a dishonest company with big dreams and small execution that plans to acquire a basket full of technical and HR problems. I urge you in the strongest possible terms to reject this rent-to-own arrangement and find some other way to resolve the problems behind iProvo.

If you have any additional questions, I would be more than happy to answer them and would request that this letter be entered in as part of the public record on behalf of proponents of open municipal fiber optic networks.

–
Jesse Harris
(801) 937-4471

http://www.coolestfamilyever.com/
http://www.freeutopia.org/

As an advocate for open-access municipal fiber optic networks, I was disappointed to learn that Provo planned to sell iProvo, the nation's largest such network, to a private entity who planned to become the sole retailer. This disappointment quickly turned to disgust and outrage as more details of this secretly-brokered deal surfaced. After attending several of the public meetings and doing some research, I am convinced that the city of Provo is about to embark on the "SS HomeNet" for a second time.

We first must question the way in which this proposition came before us. While Mayor Lewis Billings and city attorney Robert West assert that what was done was perfectly legal, such language is often a smokescreen to hide that what was done was morally wrong. The clear public intent of the original RFP was to solicit additional providers to the network. Attempting to inject new meaning into it to allow for selling the network smells like the city covering their bases, especially since we are told that there were other offers to buy the network without any idea who these other offers came from and what they were. Instead of expecting those making proposals to read between the lines, the city should have made the intent clear from the beginning.

I'm also highly skeptical of Provo's "rent-to-own" financing of the purchase. Provo will take out a loan of $40.6 million, increasing their debt load from the current $36.9 million owed on the bond, and will retain ownership of the network should Broadweave become unable to pay. While I'm sure Broadweave is all too happy to take advantage of the city's ability to bond at a lower interest rate over a longer period of time than a private bank can offer, this clearly shows municipal preference for one provider over another, a departure from the original mission to build infrastructure to promote additional private providers. We should also be concerned that should the network revert to city ownership, there will again be no retailers and new retailers would be hesitant to work with a city so willing to throw them under the bus.

The only way this suspect arrangement can pan out is if the underlying company can truly turn things around. Research shows, however, that this isn't likely. Broadweave has no more than 1100 customers, just over a tenth of what they stand to gain from an acquisition of iProvo. They are also planning to buy several other fiber networks in other states, a pace of growth that small companies traditionally are unable to handle. In particular, they are planning to buy a network in Houston that will require tens or hundreds of millions of dollars in investment to attain profitability. Sorensen Captial, their chief backer, has only $400-500 million in investment capital and surely won't dedicate such a large portion to a single venture. Additionally, none of the management team has any telecommunications experience, something that proved to be a major problem for iProvo in the past.

Broadweave's small size is compounded with a lack of experience in the competitive marketplace. Their current operations are in brand new subdivisions where they have exclusive provider status and no competition. Provo will be an entirely different game with Qwest and Comcast seeking to lock up customers in long-term contracts at attractive rates. We should also be concerned that Broadweave must increase the monthly average revenue per unit from around $36 to almost $62 to break even on debt service and operational costs, a nearly 72 percent increase. Most fiber optic networks barely reach monthly revenues of $55 per subscriber and Broadweave already has to overcome a negative public perception of the network left behind by prior providers. This new provider is likely to increase prices, cut services or a combination of the two, a tough sell to citizens of Provo.

When asked about these serious and relevant financial questions, CEO Steve Christensen has frequently dodged behind non-disclosure agreements to avoid comment. While he will hopefully be more forthcoming with municipal council members in closed meetings, the lack of public review of this data leaves us with little more than a statement of "trust us." Too bad HomeNet already ran with that line.

Original Source

Given the well-funded opposition to UTOPIA from Qwest, Comcast and the Utah Taxpayers Association, it's absolutely critical that we show up in force at future city council meetings and do everything we can to raise awareness and get others to sign up for service. Ten of the eleven pledging cities have decided to "double down" and give UTOPIA a second chance; it's up to us to help prove that this increased risk wasn't for nothing.

As a side note, a few candidates have already submitted responses but they have been slow in coming thus far. You can read what I've gotten on the wiki.

Candidates without valid e-mail addresses:

• Matt Frandsen – Governor
• Kathy Hilton – Senate 10
• Steve Maxfield – Senate 10
• Scott Jenkins – Senate 20
• Trent Alvord – House 8
• Gage Froerer – House 8
• James E. Carrel – House 9
• Neil Hansen – House 9
• James R. Gowans – House 21
• Michael M. Miller – House 22
• Thomas M. Mangum – House 22
• Gwyn C. Franson – House 27
• Jeffrey R. Morrow – House 28
• Grant Pearson – House 29
• Jackie Biskupski – House 30
• Kay M. Garske – House 30
• Michael D. Nichols – House 31
• Ron Bigelow – House 32
• Neal B. Hendrickson – House 33
• Joseph "Pete" Moesser – House 33
• Barbara Benton – House 34
• Rick Taylor – House 35
• Erin Hutchings – House 38
• Jim Dunnigan – House 39
• Fred Ash – House 41
• Steven Larsen Rinehart – House 42
• Raymond Paul Corry – House 45
• Katie Cameron – House 46
• Wayne Crawford – House 49
• Merlynn Newbold – House 50
• Greg Hughes – House 51
• Melvin R. Brown – House 53
• John Mathis – House 55
• Michael Barron – House 56
• Paul Newton – House 58
• David Starling – House 62
• Paul Penrod – House 66
• Patrick Painter – House 67
• Ed Phillips – House 68
• Kay McIff – House 70
• Michael Ferrin – House 71
• Demar Bowman – House 72
• Maureen Booth – House 75

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.