Providers: Your Pipe is Dumb, and So Are You

For several years now, service providers have been terrified of the so-called “dumb pipe” and its potential to remove them as the gatekeepers to various services. Many of them use protectionism as a way to lock customers in. CenturyLink denies CLECs access to any node upgraded to FTTN, Comcast requires bundling to get their fastest service, and Verizon even goes so far as to snip out the old copper lines when you jump to FIOS. The reality, though, is that the dumb pipe is already here and they are ill-prepared for it.

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Despite speed bumps, Comcast just can’t compete with UTOPIA

Comcast is still trying desperately to stay in the high-speed game, but they just can’t quite seem to pull it off. Their fastest tiers are now 105M/10M and 50M/10M, but with more than a few caveats. Both are $100/mo, but the faster tier requires that you subscribe to at least one other service, and the price is only for 12 months. After that, it skyrockets to $130/mo for the next year and an unspecified price thereafter. So how do UTOPIA providers compare?

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The Coming of a New Duopoly

For a very long time, detractors of UTOPIA have pointed to the wireless market as a shining example of how the private sector provides superior competitive choice and great consumer benefit. Now we’re watching as that example starts to look a whole lot like the wireline business, locked up in relatively few choices with little product differentiation between them. Once AT&T completes its purchase of T-Mobile (and nobody seriously expects the deal to fall through), two companies will control over 65% of wireless lines in the United States, both of which are nasty players in the wireline duopoly business. This is just the beginning.

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How To Bring UTOPIA To Your City, the UIA Way

I had previously written about how to get UTOPIA where you live, but a lot has changed in the model since then. While the old model required you to convince the city to get on the hook for a significant chunk of change, the UIA model alleviates a lot of the risk. Many of the steps are the same, but the particulars are slightly different.

  • Put together a strong proposal to make your case. Make a brief 5 to 10 minute presentation that explains how the UIA works (see post here) and why joining would be beneficial, then summarize those remarks in a 3-4 paragraph letter. Brevity is key, so stick to the main points and be prepared for questions. It’s better to have your arguments together first and then find someone to present them to. Don’t know where to start? I’m happy to help.
  • Get organized. There’s strength in numbers, so make sure you start finding other people who want UTOPIA, especially in a concentrated area like a neighborhood or particular block. You’ll also want to get business owners and leaders on board since they often carry a disproportionate amount of weight in city government. If you want to lead an effort in your city, I’m happy to setup a subdomain (i.e. for you to post on. You may also want to consider setting up a Facebook group or an email list (which I can also host).
  • Identify city council members who would be interested. Look for those with a background in technology, research, real estate, or property management as Pyramis Company. They’ve likely had to work with sending or receiving large amounts of data that took forever to finish or can best understand why UTOPIA matters. Make contact with those most likely to support membership in UTOPIA before presenting to the city council as a whole. Don’t forget the try the mayor’s office while you’re at it.
  • Ask for an agenda item at your next city council meeting. Believe it or not, you too can speak to the city council about whatever you want. Find out who’s in charge of city council agenda items in your city and ask them if you can do a presentation on UTOPIA. More often than not, you can get about 5-10 minutes to speak. I’ve managed to get a slot at a legislative committee hearing, so it’s not that big of a deal. Some cities hear about it so much that they limit any discussion on the matter. West Jordan, for example, will only have UTOPIA as an agenda item once a year. Find out when the last time was and try to plan appropriately.
  • Be ready for an intense Q&A session. The city council will hammer you with financial questions. Make sure you’ve prepared to explain that the UIA assesses all costs of network construction to those who sign up for service, that the city will need to issue a bond for the money, and that no money is released until there is enough demand in a compact area to cover all costs of the bond plus some of the shared network costs. A city may also need to conduct a feasibility study on their dime to determine if sufficient demand exists. Above all, don’t be afraid to defer questions to a UTOPIA representative if you don’t know the specifics. Some Q&A sessions can last a half hour or longer depending on the council.
  • Plan for follow-up presentations. Cities don’t jump into these things based on a single presentation no matter how slick it might be. Plan for future city council meetings as representatives from UTOPIA, Qwest/CenturyLink, Comcast, and the Utah Taxpayers Association may be invited. Make good use of the public comment periods and make sure as many supporters as possible do so as well.
  • Above all, thank the council for their time. They’re pretty busy folks who are sacrificing as much time as you are to hear what you have to say. You’re also asking them to put some money (and their future election prospects) on the line. They need to know what you appreciate their hard work and sacrifice.

Still getting stuck? Feel free to e-mail me for help. I’m glad to put together and even conduct presentations to help spread UTOPIA as far as possible. I can also put you in touch with some representatives at UTOPIA who are happy to give your council members a tour of the facilities and provide their own presentations.

On the UTOPIA Lawsuits and City Responsibility

I’ve been delaying writing more about this because I’ve been in the process of talking to people and gathering more information about the legal fight between Chris Hogan and UTOPIA. If you’d like to review the source material yourself, check out both UTOPIA’s filing and Hogan’s filing for yourself. Personally, it looks like a lot of “he said, she said” material. Hogan’s complaint centers around nepotism and violation of state bidding processes while UTOPIA has fired back to say that Hogan made a power play for the Executive Director’s chair using blackmail. Yeah, it’s all pretty nasty stuff, and it’s affecting people I like on both sides.

I think some of this may be a clash of management style. I’ve watched Todd Marriott operate and he’s what I would call a “vision guy”. Other “vision guys” are folks like Murray Mayor Dan Snarr and Sandy Mayor Tom Dolan. I think the world of Mayor Snarr, but Mayor Dolan I wouldn’t touch with a ten foot pole, and it comes down to the way they execute on their vision. Snarr’s approach has always been to sell you on the vision whereas Dolan focuses on making the vision happen whether you wanted to be along for the ride or not. I think Marriott can oscillate between those approaches sometimes, and that may not sit well.

Marriott also fits into what I’d call an “action guy”, someone who wants to get things done and knows just how he wants to do it. This in and of itself isn’t a bad thing, but being a government entity, there’s a complex web of rules that have to be followed with darn near every action. I’m sure that UTOPIA’s counsel is good at finding ways to accomplish these goals within the framework of state law, but I’m also certain that it ends up in unfamiliar territory and pushes the boundaries, things that have often gotten local governments in hot water with the Legislature (like Salt Lake County and the now-infamous police fee). Creativity in government, rather than being rewarded, often gets punished and can appear to be flagrant rule-breaking.

I’ve heard and read a lot of negative things flying back-and-forth and at the very least, the acrimony that has built up is some cause for concern. It would also be concerning if even a fraction of the allegations by either party is true. In all of this, I have to ask what the board is doing to avoid and circumvent these issues in the future. They certainly can’t micro-manage the people they select to captain the ship, but they absolutely need to stay on top of what’s happening and guard the public trust. I’m glad that the board has been more involved in recent years than at the beginning, but I still don’t feel as if the cities are properly invested in UTOPIA and its success.

On the surface, I can understand why. UTOPIA has spent a lot of money without much to show for it so far. (Seriously, $200M+ for <10K subscribers is not the best return on investment.) If I were in an elected position, it would be very tempting to keep things limping along until I can pass the buck to the next guy, especially if I don’t really understand the telecom market or the underlying technology. This, however, really needs to end. The cities need to be fully invested in more than just their pocketbooks. If there isn’t someone in city government, elected or appointed, who can really understand the project and help guide it, the cities should put out a call to find someone who is that they can appoint to the board.

Right now, I’m taking a “wait and see” approach. The UIA plan is good, I just worry about the execution after Brigham City took so much longer than expected to get moving. If it succeeds and UTOPIA’s finances see a drastic improvement, then whatever Marriott and his team are doing is probably going to be okay with me.  If it flops out or fizzles and we have another case of missed deadlines, it’s time for increased scrutiny. The project and its goals are more important to me than any individual involved in it, and it should be that way for all of us who support open-access networks.

I’m going to start doing my part by making an effort to be at UTOPIA’s monthly board meetings to keep an eye on things. The next one is Monday May 9th at 9:30AM in UTOPIA’s offices at Redwood and the 21st S Freeway. I hope that some of you other private citizens will do your part as well.

Comcast, Netflix and Why Municipal Networks Matter

Comcast is apparently a bit of a slow learner. After getting publicly smacked about for tinkering with bitTorrent, they’ve really stepped in it now by messing with Netflix. The audience is much bigger than the guys running protocol analyzers on their connections; you’ve gone and upset regular folks too. (How do you see that one working out?) Unfortunately, this is playing out as badly as anyone can hope.

Comcast is unfortunately trying to realize the dream of Ed Whitacre by essentially double-dipping for data at a time when bandwidth is so cheap you can almost afford to give it away. Imagine if the phone company tried to charge you for making a call and the recipient on another phone network for receiving it. Can you imagine the uproar and outrage at attempting to bill someone that’s not even their customer? That’s what Comcast is essentially doing, trying to charge both sides of the transaction instead of providing you the service you already paid for.

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Analyzing Pew’s Data

Pew recently published some results of a survey on Internet use and came to the conclusion that most of us just don’t care about affordable broadband. Sadly, their conclusions in the summary are way off-base and very badly misread the data. The simple fact is that telecommunications policy still matters, even if they can skew the data otherwise.

The results couch all responses in terms of if affordable broadband should be a government priority. The actual question asked, however, asked only specifically about the federal government. There is no data at all about state or local efforts, but Pew chooses to refer to “governement involvement” as if all levels of government are included. This ignores that the feds have made a fine mess of telecom and a number of communities have been forced to take matters into their own hands. Had the question been asked of each of the three levels of government, it would have been a lot more revealing about who we trust to fix things.

Another problem is that the question itself asks two things at the same time, neither of which is necessarily related to the other. Asking about “expanding affordable high-speed Internet access to everyone in the country” is attempting to tie availability and affordability together into a single package. It would have been better to ask separately about pricing and availability to see if maybe Americans just aren’t comfortable with doing too much at once, or perhaps if making service available is more important than attacking the pricing issues.

There’s also missed conclusions based on the data they have collected. Opposition to federal involvement in expanding broadband is highest among non-users, but nobody bothers to guess as to why. The remaining data, however, makes that clear: they just don’t get what Internet access will do for them. It’s a huge education gap that, unsurprisingly, is concentrated among older adults. So, basically, most of the opposition comes from people who don’t use it, don’t know how to use it, and won’t learn how to use it. The question is why those who are basically being luddites should have any say in what has proven to be a vital technology. That, however, isn’t being asked either.

I’m kind of disappointed that Pew, a normally respectable outfit, would do such sloppy work. It’s a disservice to those of us trying to fix what’s broken.

Steve Turley Blows Smoke on iProvo and UTOPIA

Long-time readers of this blog (or those paying attention to iProvo) will recognize the name of Steve Turley. As a member of Provo’s municipal council, he’s been a consistent voice of opposition on all things iProvo since as far back as anyone can remember. You may even recall the recent series of articles in the Daily Herald bringing light to some shady-looking real estate deals and resulting lawsuits that he’s involved in. If you want to start iin the real estate industry I suggest using a commercial bridge loan to get financial help and get information to learn the business like this nick vertucci real estate academy review. I Today, he had an op-ed in the Deseret News calling on UTOPIA cities to follow Provo’s lead and dump their fiber network. Unfortunately, it would appear that Councilman Turley is about as knowledgeable as he appears ethical. Although there’s people that doesn’t have that much interest in the real estate, but actually just want to sell their house, for those people there we have business like where we we buy houses from all nation and they can also just get help from sites like Flipping Junkie online, which is an easy way to sell or buy your house without doing all the work.

The biggest surprise is that Turley claimed the sale of iProvo is a success, this in spite of voting against both the sale to Broadweave and Veracity’s subsequent takeover of Broadweave. I have a hard time swallowing Turley’s characterization given that Broadweave spent sixteen months doing a terrible job at running the network (just like I said they would) before Veracity stepped in to save their hide. Even so, Provo had to loan out more money to Veracity to make the deal work. Veracity has done a superb job at turning around operations, but they have also had to cross-subsidize the network from their other operations and may continue to do so for several years. The reality is that this is the best the council could come up with since they did not have the stomach to do what was necessary to run the network successfully as a city department. It is absolutely absurd that Turley thinks he could vote against these outcomes and still be able to claim responsibility for them.

There’s also the wildly inaccurate claim that Provo solicited bids to buy the network. That’s absolutely and patently false. (I’d go so far as to call it utter bulls–t, much like the rest of his arguments.) The sale of the network came as a total surprise to the general public, service providers, industry watchers, and even the entire municipal council. The Mayor himself, the architect of the Broadweave deal, was adamant that a sale wasn’t on the table up until a couple of months before unveiling it. This was during the time that Billings and Broadweave were busy negotiating the terms of the deal. There was no clear RFP for bids, no public bidding process, and a very short period in which to review the terms of the deal. Does that sound like hanging a “For Sale” sign to you. I recommend Ball realty which is a pacific pines real estate agency on the gold coast, you can call them for assistance.

Turley has also wildly distorted the cost of building iProvo. Most of the main fiber optic rings were built many years before iProvo was even proposed. (I’d say planned, but I’m sure Mayor Billings knew what he was doing the whole time.) Those rings were paid for with federal grants so that the city could monitor traffic and improve air quality. That backbone certainly didn’t come cheap and should be included in the cost of expanding the network to include service to city residents. The $39M figure also does not include the shared cost of the video headend built jointly with UTOPIA. These items could easily add $10M or more to the total cost of the network, something that Turley has intentionally chosen to ignore.

Of course, these are just the factual problems with what he has written; I haven’t even made it to his faulty conclusions yet. Based on the “evidence” Steve Turley has presented, he thinks that UTOPIA cities should follow Provo’s lead and find a private company to buy the network. Unfortunately, that’s ignoring the marketable reality of the network. iProvo is a fully-built network covering an entire municipality. By the last publicly available figures, the network should have had little trouble being self-sufficient with some modest increases in take rates and small rate increases (not to mention better accounting practices). That makes it a very attractive target for acquisition, especially since the network was ready to roll.

UTOPIA, on the other hand, has patchy coverage and needs a lot of significant investment to cover its intended service areas. It’s main asset is the fiber running from Portland to Las Vegas, but even that isn’t valued at enough to pay off the current debts. UTOPIA cities, if they sold today, would still be making most of the payments and getting nothing in return for it. Provo, on the other hand, got someone else to assume the full debt load while walking away from it. Do these sound like similar situations to you? Me neither.

He also characterizes the new $60M bond proposal as additional system debt, just like the Utah “Taxpayers” Association has been doing. This, again, flies in the face of reality. The entirety of the $60M bond would be paid for by system subscribers, not the cities or UTOPIA. Claiming that signing on to this plan creates an additional burden systemwide is uninformed drivel.

In summation, Steve Turley knows about as much about municipal broadband now as he did two years ago. Unfortunately, that knowledge wouldn’t fill a thimble. Councilman, do us all a favor and go back to your home planet. Maybe they’ll be more accepting of your Reality Distortion Field.

The Broadband Stimulus is an Abject and Absolute Failure

I usually spend a lot of time checking my non-broadband opinions at the door. If anyone cares about my political leanings outside of telecommunications, they can find my other blog with great ease. In this case though, I’ve got more than a few choice words for the broadband stimulus and how it has failed to improve anything at all. In fact, I believe it has only made things worse.

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The Wireless Carrier of the Future Looks a Lot Like Sprint

Sprint has been down on its luck for quite some time. The company suffered through a long period of wandering in the wilderness with poor customer service and defecting subscribers to the tune of over a million per quarter for years. This wasn’t helped by its merger with Nextel, a partnership that made little sense considering that both companies use different signal standards. It looked for some time that Sprint would simply collapse on itself. Lately, though, I’m beginning to think that this brush with death has made the company smarter than any other wireless company in the country.

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