I’d advise UTOPIA supporters in or around Orem to show up to the meeting at 1031 W. Center St. Orem on Tuesday October 25 at 2PM. There will no doubt be disinformation by the truckload that will have to be countered.

UPDATE: Per Chris Nichols, the president of the Utah County Association of Realtors, the Utah Taxpayers Association has been un-invited from the event. He stated that his goal is strictly to discuss the implications of transfer of title when a homebuyer has chosen to finance the installation including how it appears when doing a search on the property. He also made it clear that any attempts to derail the discussion beyond that would be thoroughly unwelcome.

Chris also stated that UTOPIA was invited, but the person whom he named as “someone who has done work for UTOPIA” was not a name I’m familiar with. Granted, I don’t know everyone on their payroll, but if the PR department doesn’t know anything about it, it kind of maybe didn’t exactly go to the right person. Sounds like they both had their wires crossed on that one.

For the record, he was pretty mad at me and spent over 10 minutes chewing me out on the phone. I tried to explain why I formed the opinion I did, but he had no interest in hearing it. The website for the event links straight to the light-on-facts UTA website and lists a smattering of candidates for city council in Orem, both of whom are anti-UTOPIA (though one of them is being a realist about the situation). These combined with questions that appear to imply that the UTOPIA contract causes significant real estate sale issues created a very bad public face. The website itself also has no contact information as to who the responsible party would be.

My take? He wasn’t holding a tight enough leash on his employee Oldroyd who then worked with the UTA to try and sneakily co-opt the event for his own political purposes. My publicizing of it was very embarassing (and understandably so) and he needed to take it out on someone right then and there. Hey Chris? No hard feelings this time, but maybe try to be a bit more understanding of where someone else is coming from next time around. A lot of bloggers wouldn’t be as gracious as I am to heavily update an article to show both sides.

UPDATE 2: For those who are interested, I have a copy of the robocall used to publicize the event. Link is below.

UCAR UTOPIA Robocall

For starters, let’s consider the restrictions on who can actually get the service. For some reason, it is only extended to those who can qualify for the federal free lunch program. I suppose you have to set the bar somewhere, but this seems like an odd bar to set. It ends up excluding childless homes and a lot of seniors, the latter of which are the second-largest group of Internet users behind the very young. You also can’t be a current subscriber or have subscribed in the last 90 days, so the current poor who have eked out enough for service are out in the cold. And if you’ve ever been behind on a bill? Forget about it. You (along with those who have unreturned equipment) are right out. You also have to hope that your neighborhood isn’t one of the many redlined by Comcast’s deployment efforts. If service isn’t available right now, no way you can get it, and odds are against Comcast expanding there. These terms very drastically limit who can actually get it.

As for the service itself, it’s a 1.5Mbps/384Kbps service for $9.95 per month. The normal price for the service is almost triple that at $27.95 per month, so this may seem like a good deal. Not so fast. Free Press found that Comcast produces a gross profit margin around 70% on its broadband service, so that $27.95 service costs Comcast about $8.39/mo to actually deliver. Sure, Comcast is cutting profit margins, but it’s on a product that they are unlikely to deliver in any quantity. I’m also left wondering how such margins can be justified given that the actual networks are paid for and the cost of DOCSIS 3.0 upgrades is running about $7 per port. Private companies are entitled to a profit, sometimes even astronomical ones, but there is a lot of evidence to suggest that these margins could be considered gouging, especially with the limited competitive choice available to most consumers.

One of the few silver linings is the computer purchase program, but it’s still not as great as you might believe. The offer is a Windows 7 Netbook for $150. Those systems retail for around $200 right now, and I’d bet Comcast is getting a pretty good price on them. Odds are good that Comcast is taking a minimal loss, if any, on each unit. It works out in favor of those who qualify, but it’s not quite as great as they make it out to be.

Is all of this better than nothing? Sure, and it’s a great deal for those who can get it. That said, the amount of PR hype surrounding it papers over why the base service is so expensive in the first place and how even at deep discounts, it’s not like Comcast is giving away the farm. In a truly competitive market, they couldn’t get away with it. In most areas limited to a handful of choices, it’s what we end up being stuck with.

The UTA claims that both networks need to “consider all possible solutions”. The reality, however, is that the UTA has pushed only one solution on UTOPIA: to stop existing, take a financial bath, and have absolutely nothing to show for it. Apparently UTOPIA choosing a solution contrary to “commit immediate seppuku” will, in the UTA’s mind, mean that you haven’t bothered to consider all the options. iProvo, however, can choose to pay off the bond with public money and somehow still stay on the good side of the UTA. Huh? Yeah, I don’t get it either.

They then also cite the work of fiction they published in May concerning UTOPIA’s projected and actual budgets. The problem with all of those numbers, however, is that they don’t add up. Go to the State Auditor’s Office, add up the numbers for yourself, and see how none of them match the figures that the UTA is using. Believe me, I’ve tried. I spent 4 hours pouring over them and crunching them to try and get the same totals. I even consulted an accountant to make sure that I was doing it properly. It’s as if the UTA pulled numbers straight out of thin air and nobody had bothered to question it.

There is also the glossing-over of the disastrous Broadweave years, years that left the network in a serious state of disrepair and with a heavily tarnished reputation. They mention a merger of Broadweave and Veracity when it would be better characterized as Veracity absorbing Broadweave and doing the City of Provo a huge favor (especially since the mayor and council had no idea what they were doing). Of course, a private entity running the network and experiencing massive operation problems almost from the get-go doesn’t get into their “the private market is always better” worldview, so it has to be omitted.

I’ve also noticed that they aren’t screaming “sell” at iProvo even though one of the options on the table (and likely to happen) is for the city to maintain ownership of the network and pay off the bond. You know, the same thing that UTOPIA is doing but gets criticized for. So… paying for the network in UTOPIA cities is an unmitigated disaster, but doing it in Provo is “the least bad option”. Are you seeing the same pattern I am?

The worst of it is that the UTA is acting all butt-hurt that UTOPIA doesn’t want to listen to them. On what plane of existence would they want to? They’ve gone up to UTOPIA, thrown a drink in their face, kicked them in the shins, said something nasty about their mother, and then expect a seat at the table as they scream “I wish you’d never been born”? How exactly does that jive with their “water under the bridge” attitude towards iProvo? It doesn’t and it can’t. They’ve shown no indications of being willing to be constructive, just that they’re going to criticize every single move in the most shrill tone possible. After a track record of being anything but constructive, it’s hard to swallow that all they wanted was a seat at the table. The ultimate irony here is that they shut down discussion on their website with voracious moderation, but expect UTOPIA to allow their board meetings to act as a UTA soapbox for tearing the agency a new one.

If the UTA wants to be taken seriously, they need to shut their pie holes unless they have some actual constructive suggestions (and no, selling for pennies on the dollar doesn’t count). These double standards and loads of manure only further weaken whatever remaining credibility they might have had.

(Yes, I know a lot more about iProvo than I’ve written here. I have Veracity’s side straight from the horse’s mouth and will be meeting with Mayor Curtis on Monday to get their perspective. Expect something good and meaty next week, kids.)

Is Comcast blocking anything? I doubt it. They took such a big PR black eye the first time that they’re unlikely to be dumb enough to try it again. That the stain persists years later, however, shows what a bad move it is to manipulate user traffic. Let that be a warning to all service providers of the lasting consequences of abusing users.

My review of the minutes shows that in 2009, Payson did not attend nine of the monthly board meetings. In 2010, eight meetings were missed. Neither of the 2011 board meetings with available minutes show that Payson was in attendance, and I’m willing to bet that the others that I don’t have minutes for would show a similar pattern. Making it to just five meetings in over two years is abysmal, especially when there’s the option to participate via phone.

Given the large amount of stranded investment in the city and Payson’s large financial commitments to the network, this seems like a total abdication of their responsibility to city taxpayers. Shouldn’t they be making an effort to get the network covering both operational costs and debt service? Wouldn’t it be prudent to set aside money for participating in the UIA, money that is guaranteed to be paid back by subscribers and utilize infrastructure already in the ground? Why would Payson do an ostrich impersonation in the face of the harsh fiscal realities?

If I were a resident of Payson, I’d be out for blood. Contact Councilman Brad Daley and let him know that if he’s going to be on the board, he has a responsibility to show up to meetings and do the people’s work, especially since he voted for UTOPIA in the first place. If he won’t do it, it’s time to pressure Mayor Rick Moore to find someone who will.

I can’t say I’m too surprised. Technologically speaking, they had all the right ingredients. Most of the guys who founded Connected Lyfe had been working for Move Networks, a company that made some impressive video streaming products that could dynamically adjust the video bitrate depending on current bandwidth conditions without a bunch of annoying buffering. Where they went wrong, however, was thinking that programmers would line up to stream their shows to any and all screens they could support. I mean, the networks literally own Hulu and even they can’t get too disruptive. Combined with the rapid burn of investor cash, I couldn’t see this one going much of anywhere.

I hear, though, that UTOPIA is working on some stringent new requirements for new providers so that these kinds of things start happening. I understand they’ve been in the works for a few months and still aren’t finalized, but hopefully we’ve seen an end of shining star new providers that flame out.

I can’t speak to Mr. Jones’ qualifications, but I do know that UTOPIA has done plenty of business with TetraTech in the past. They are also a very large multi-national corporation with offices across the world, including two here in Salt Lake County. Even with the blood relationship between the Marriotts, I don’t see that this would necessarily disqualify TetraTech from being a candidate, especially if the work they did in the past was up-to-par.

UTOPIA has also told me that Hogan’s contract was up for renewal and they opted to not renew it. Obviously, I don’t have any details beyond that, but the timing does seem to coincide with my recollection of when he was brought on. Assuming an annual contract, the timing would likely fit.

The Tribune, however, doesn’t dive into any of this background to provide essential context here. I also noticed that they did not include any statements from UTOPIA to provide balance to the story, though I imagine with pending litigation, they can’t really say too much anyway. This is the far too common behavior I’ve come to expect from Utah’s major media outlets when it comes to UTOPIA. They present very one-sided stories and practically cheerlead for UTOPIA’s failure from the editorial pages. There are two sides to every story, but outlets like the Tribune and Deseret “News” are only concerned with the doom-and-gloom side that moves papers.

I’d argue that we can’t. Sprint will continue to be a bit player in the space since they don’t have much in the way of wireline assets and Clear is a boat anchor around their neck. Smaller and largely regional cell providers like Cricket and US Cellular don’t get the hot devices people want and often get chained down in pre-paid pricing plans. The MVNOs live and die by the terms set by larger carriers. The big companies sit on a mountain of unused spectrum which prevents new entrants to the market from even taking hold.

In short, we’re witnessing the wireless space do the exact same things that make us hate the wireline space. This merger will mean higher prices, less consumer choice, and more regulatory capture than ever. Sadly, I expect the same thing to happen that always does when a bad deal is put before the regulators: the state PUCs and PSCs will hand-wring and sign off on what they know is a bad deal using conditions that they know either won’t be met or would have been anyway, and the FCC will just rubber-stamp the decision with minimal oversight or review. And the whole time, we’ll be told that it’s a good deal for consumers.

It’s not surprising that a cable industry shill would attempt to trash UTOPIA in the press. It’s not even surprising that he would attempt to portray himself as a dispassionate and disinterested third party. Both of these have been done time and time again, like when Heartland Institute’s Steven Titch did consulting work for Qwest and claimed it had no bearing on his harsh criticisms for iProvo and UTOPIA. If anything, I automatically expect some kind of conflict of interest to emerge from parties opposed to UTOPIA as so many of them will always act in their own financial best interests. (Utah Taxpayer’s Association, I’m looking at you.)

What is surprising, shameful, and downright embarrassing is that the Salt Lake Tribune didn’t spend the entire 2 minutes on Google required to find all of this out. Even if they did, they chose not to disclose it in their article. One of two things happened: they were either negligent in their journalistic duties or (and this is more likely) they are continuing to advance the position of the editorial board that UTOPIA cannot succeed. Whichever it is, I am deeply unimpressed.

First off, the UIA bonds are not an unconditional loan. They are funds that will be secured by payments from subscribers. If there aren’t enough subscribers to secure repayment, the money doesn’t get touched. You would think that such an arrangement would be acceptable to an organization that purports to represent taxpayers as it clearly shifts the burden from the taxpayers as a whole to the subscribers. Attempting to characterize the UIA as a big grab-bag is a big lie.

Secondly, the UTA says that UTOPIA is running a $20M deficit in “operating expenses”. The problem, however, is that their version of “operating expenses” is entirely unclear. I’m betting that they chose to include equipment depreciation and possibly even the bond payments in that figure in order to paint a much more dire picture than actually exists. For all of the accusations by the UTA that UTOPIA doesn’t disclose enough information, it’s hypocritical and extremely irresponsible of them to distort the numbers for the purposes of supporting their arguments.

Remember the last time the UTA tried to organize an anti-UTOPIA protest? UTOPIA and its supporters showed up and ended up turning half of the attendees into subscribers. Let’s show them it can be done again. Centerville meets tonight (October 19) at 7PM, Orem is October 26 at 6PM, and Payson is October 27 at 6PM. All meetings are at the respective city hall. Let’s show the UTA that lying won’t get them very far.