That's interesting. Can you share more details about being a service provider on the iProvo and AF networks? In what way we're they substandard?
Jared > Sent: Monday, August 07, 2017 > From: "Sterling Jacobson" <[email protected]> > To: "[email protected]" <[email protected]> > Subject: Re: [AFMUG] OT Municipally funded ISPs > > I agree with that. > > The numbers never added up. iProvo never added up, Utopia never added up, > Amercian Fork system numbers never made any sense. > > I was a network provider on iProvo and AF networks for a while and sold them > off since they were always substandard and profit was driven to minimum. > > > -----Original Message----- > From: Af [mailto:[email protected]] On Behalf Of [email protected] > Sent: Sunday, August 6, 2017 10:46 AM > To: [email protected] > Subject: [AFMUG] OT Municipally funded ISPs > > Here is an editorial in the Deseret News today. It is just an opinion. > > And I know Roger has been a reader of this list (Roger runs UTOPIA). > > But I have always been against municipal ISPs on principle. Some things the > government is good at, some things they are not good at. > > Roads and Streets == OK > Police and Fire == OK > EMS = OK but there are private providers that are OK too. > Water and Sewer = OK but there are many private systems Power and Gas = Meh > - I work in a city that has sold off their power and gas to private because > it was not a revenue center and they had lots of power distribution problems. > > Telecommunications != OK > > They almost always seem to be problematic. And they compete with all of you > (us) folks that can do a better job. (Sorry Roger, but that is my > opinion). > > > BY BILLY HESTERMAN > > FOR THE DESERET NEWS > > A longstanding principle of the Utah Taxpayers Association is if a service > can be found in the yellow pages, then government shouldn’t be providing it. > We have seen far too many times where government attempts to compete with the > private sector and ends up wasting taxpayer money. One prime example of this > is the failed UTOPIA boondoggle that continues to plague the 11 cities that > created the entity. > > On Aug. 14, the Utah Infrastructure Agency, which was created in 2011 to give > UTOPIA more borrowing capacity, will vote on taking out a $13 million bond to > further build out the UTOPIA network in hopes of making the whole effort > profitable. The vote will likely pass but the effort to make UTOPIA and UIA a > success for taxpayers will never be realized. > > This attempt to continue to send money after a bad idea has to stop. > > The private sector is already providing the same service that can be obtained > through UTOPIA and it is past time that the local governments that created > this mess find a way out. > > Recently, the University of Pennsylvania released a study that examined 20 > municipally owned fiber networks from across the nation; UTOPIA was included > in the study. > > The report found that a majority of these networks struggle to recover the > costs that were incurred to build them. It went on to show that of the 20 > projects, only nine have had a positive revenue stream but that of those > nine, five are generating returns so small that it would take more than 100 > years for the project costs to be recovered. Only two of the 20 networks are > expected to earn enough to cover their project costs during the useful life > of the networks. > > The Penn report went on to state that these government-owned ventures > struggle to ever make a profit and put taxpayers in danger of seeing their > local government increase debt, lose bond rating status and elected officials > becoming distracted from other important issues because they are solely > focused on the government’s fiber business. The report found that if UTOPIA > continues in its current state, that the project will likely never turn a > profit. It observed in a five-year span from 2010-2014 that the network only > obtained 11,000 subscribers and that with a low subscription take the network > was realizing less than $30 in revenue per household in the cities that make > up UTOPIA. That is well below the $446 per household benchmark achieved by > other projects that the report looked at. > > I am often asked why the Utah Taxpayers Association cares so deeply about the > UTOPIA issue. One statement from the Penn report sums up why we have taken > the position we have as the report states, “Many cities managing these > projects have faced defaults, reductions in bond ratings, and ongoing > liability, not to mention the toll that troubled municipal broadband ventures > can take on city leaders in terms of personal turmoil and distraction from > other matters important to citizens. City leaders should carefully assess all > of these costs and risks before permitting a municipal fiber program to go > forward.” > > The risks and consequences are too much for taxpayers to shoulder. > > UTOPIA and UIA officials should vote against the upcoming $13 million bond > and start looking for new directions to take the network that will be > beneficial for taxpayers instead of continually investing money into a > sinking ship that will never be sea-worthy. > > Billy Hesterman is the vice president of the Utah Taxpayers Association. > >
