Inside sources confirm the rumor from a month ago: Steve Christensen will leave his position as CEO of Broadweave and will not longer be a part of the company effective today. After months of relying on the line-of-credit to make the bond payment and facing an increasingly hostile HOA in Traverse Mountain, investors at EsNet are rumored to be taking over operations and exerting much greater control over the company to protect their investment. I say it’s about time.
This change in leadership can only be a good thing. Steve always struck me as a used car salesman in a better suit, all too willing to believe his own inflated hype. In contrast, I hear the guys from EsNet are very savvy and know how to run a business. Maybe this ship can finally be turned around.
Word around the campfire is that EsNet isn’t very happy with how Broadweave is doing and plans to find a new operations manager as part of taking a more active role in the company. I’ve confirmed with with two sources, so it seems pretty solid. One of the sources claims that CEO Steve Christensen may be out of a job as part of the reorganization. It’s good to hear that EsNet is trying to fix what’s broken but will it be enough to right the ship? There haven’t been any reports of it so far, but I’m willing to bet that Broadweave made their bond payment from the reserve fund yet again and is on-track to do so next month.
A post at the Traverse Mountain Community Forum reveals that a recent change in mangement with Mountain Home Development Group has the Christensens out of management positions. The new management discussed issues with Broadweave at length including, in the commentor’s summary, the continued lack of video, pricing disparities, poor phone service, poor customer service, and potential contract violations. Residents in the master-planned community are obligated to pay $75/mo for phone and Internet services, but it’s unclear as to what speeds or services are being provided. Many are worried that they signed up for long-term contracts with DirecTV or Dish Network and could be obligated to pay for both services if/when Broadweave rolls out video.
The subtext seems pretty clear: the new management is pretty ticked off at Broadweave and wants them to shape up or ship out. Without the family connection protecting them from enforcing provisions of the contract, Broadweave may be on thin ice.
The Daily Herald reported today that Broadweave failed yet again to make their payments to Provo from their operating revenues, dipping into the reserve fund for the third month in a row. This is despite claiming revenues that have increased 20% in the last 6 months and adding 400 more subscribers since last month. Some back of the napkin figures from a telecom professional I know shows that Broadweave may need to add as many as 5,000 new subscribers at an ARPU of nearly $65/mo in order to make that bond payment.
Because of the weather, new installs are challenging at best. Trenching the frozen ground isn’t much of an option right now which would force new installs to lay fiber across their lawn until the trench and conduit can be put in. Odds are that a lot of the new subscribers are incoming college kids for the winter semester, the ones that are predominantly Internet-only subscribers and disproportionately heavy users.
Since the only data we have is pre-Broadweave or heavily filtered, all we have to go on are best guesses. So far, though, it’s not looking too good. If they experience a sudden drop in subs in May-June, we’ll know for sure that the student population is making up a large proportion of the subscribers.
If you’re already sick of the fight between DirecTV and KJZZ 14, you won’t much care for this. The station owners of ABC 4 and CW 30 have announced that their retransmission agreements with both Broadweave and Union Cable, a Wyoming cable company, will expire on January 31 and that no new agreement has been negotiated. Odds are that the stations, like so many others, are probably asking for a hefty increase in retransmission fees to make up for sagging ad revenue, a cost that either the service provider has to eat or pass on to you. The broadcaster is urging viewers to call both companies to “encourage” them to sign new agreements.
Personally, I think it’s kind of silly for stations to be picking these fights. Viewers still signed up for satellite before they carried local channels and just used an over-the-air antenna to pick them up. Most viewers now also have the option of using their high-speed Internet connection to catch up on their favorite shows, usually with fewer (or no) commercials. Most of these fights, however, end up in service provider capitulation and higher bills for all of us. I hope Broadweave and Union Cable have their best negotiators on this one.
Sounds like the iProvo troubles are about to get bigger. According to a Nuvont installer who would like to remain nameless, Broadweave has defaulted and could likely be returning the network to the city in very short order. Nuvont is also trying to switch video customers from iProvo to Dish Network, presumably in preparation for serious network troubles. This could very well mean the end of both Broadweave and Mayor Billings’ political future.
Anyone else out there heard about this?
The Salt Lake Tribune reports that Broadweave has failed to make its November payment to Provo City, instead having to rely on the security deposit. CEO Steve “we’re meeting our financial goals” Christensen and Mayor Billings both tried to gloss over the missed payment while Steve Turley, predictably, has called it bad news. Of course, if Broadweave is unable to bill their customers, that might account for coming up short. This will most certainly be a major issue during Provo’s upcoming municipal elections.
One of the allegations from the Broadweave insider is that they don’t know who their customers are until they call in for support. A commenter recent confirmed this saying that they had been installed in August but have yet to receive a bill for any service and says that a neighbor is in the same boat. The question, of course, is if Broadweave can back-bill these customers successfully or not. It’s the customer’s responsibility to notify a company if they aren’t billed for services rendered, but good luck trying to keep the customers happy when you do it.
Anyone else getting service from Broadweave without being billed? Sound off in the comments.
There’s a rumor about that Mstar has outsourced all customer support to ServerPlus. Employees in Mstar’s call center were reportedly either laid off or offered a job at ServerPlus with a big pay cut, possibly down to as little as $10 an hour. Mstar had initially used ServerPlus for fiber customer support and found it lacking, so the move back to them seems like a step backwards. I’m going to count it as another tick mark on the Mstar Death Watch.
A separate rumor says that Broadweave is in negotiations with ServerPlus for the same thing. That would be bad news for anyone currently in a customer service position with the company.
The Salt Lake Tribune reports that city records show that Mstar and DynamicCity, the network management company for UTOPIA, also put in bids to either manage or run the city’s fiber optic network. A fourth company also reportedly made a bid, but their name is being kept secret by the city. DynamicCity President Cory Turner (who I know and who wasn’t president of DynamicCity at the time) said that the bid to operate the network was a long-shot at best. That proposal was put together by D. Keith Wilson.
Mstar’s involvement in the process, however, is rumored to be very different from how it is portrayed in this article. Word on the street is that once they caught wind of the sale and were denied based on their account being in arrears, they quickly made a deal with Broadweave to sell the customer list and have their debt forgiven. The rumor mill says that Broadweave then double-crossed Mstar when board member Fraser Bullock threatened to pull business from the law firm that employed Mstar’s principal investor and demanded payment to settle the matter.
The major dailies reportedly are all aware of these shenanigans but have gotten a lot of pressure to keep it all under wraps. I’m privvy to only the surface details of the matter, but any current or former Mstar employees who’d like to fill in the gaps is invited to call or e-mail me.