Dear Friend:
I am writing you in my capacity as a
member of the Advisory Board of
Utahns for Telecom Choices.
I subscribe to the Deseret Morning News
and appreciate their voice in community affairs. That's why Sunday's editorial
opinion about the UTOPIA community-owned fiber-optic network was such a
surprise.
I'm amazed that the business-minded folks
at the News completely overlooked the most important feature of Utah 's
community digital pipeline project...
Competition in telecommunications services.Would the Morning News argue that Utah
should be served by only one airline? Of course not. But if airlines had to
build their own airports, that likely would be our situation.
A metro area of our size can support the
cost of building only one major airport. If we expected the airlines to build
the airports, we'd probably have just one. And it would only make sense for
that airline to protect its position. We'd be left without choices.
Instead,
city governments build
airports. This allows several airlines to compete for business on the basis of
service and price. The result is affordable, convenient air travel bringing
more trade, tourism and better quality of life. The cost of the airport is paid
back by fees included in ticket prices paid by the passengers who use the
airport. (In fact, the Salt Lake Airport had a cash surplus of $38.6 million
last fiscal year.)
Now, here's the crucial principle that the
Morning News completely missed:
We can and should take this same competition-enhancing approach to
telecommunications, including voice, video, TV entertainment and the
Internet.It's easy to understand how the News
overlooked this critical point. Like most people, they think of the network
owner and service provider as one and the same.
Historically, once the first company
installed a network of copper wires, it wasn't economically feasible for
would-be competitors to install their own parallel networks. So we ended up
with a network owned and operated by a single regulated monopoly.
Existing networks have physical
limitations that make it difficult, even impossible, to offer advanced services
or share the capacity among multiple service providers. In short, the
limitations of the technology dictated limitations in the business model.
But this is the digital age, and we don't have to think that way
anymore.The enormous capacity of fiber-optic
technology makes it feasible for multiple service providers to share a single
network delivering high-bandwidth services such as TV, HDTV , video streaming,
video conferencing, ultra high-speed Internet access, telephone service.
We can now reject the outdated model in
which each service provider has to build its own physical infrastructure. The
public
can provide a high-capacity digital network and allow multiple private
companies to compete across that network, just as multiple airlines compete at
the same airport.
Under this model, technology is no longer
the obstacle to competitive telecom services. The only obstacle is
old-fashioned thinking. I'm frankly disappointed that a newspaper that usually
champions free enterprise would oppose a project that fosters competition and
consumer choices.
How will the community-owned fiber-optic pipeline promote
competition and bring prices down for families and businesses?By the middle of 2004, residents in UTOPIA
member cities will begin to see more advanced, ultra high-speed Internet
access, telephone, TV channels and "video-on-demand" at very
competitive prices.
Businesses will also see competitive
offerings for everything from a few phone lines to full-blown 100-megabit
Internet access 60 times faster than a T-1 and fully capable of live video
conferencing with no choppiness or hesitation.
Won't it be great to have choices?
Already, multiple companies are asking to
use the network. Within months of launching the community digital pipeline,
additional companies will begin offering competing services on the network.
Won't it be great to have choices?
As these new competitors gain ground, all
consumers will benefit from the increased competition. We hope, in time, all
companies, including the current providers of phone, cable TV and Internet
access, will come onto the community network (the current providers have been
invited from the very beginning but have so far declined).
Won't it be great to have choices!
How will the Community Digital Pipeline pay for itself?Here's how the network gets paid for:
Residents and businesses subscribe
to the services they want
They pay private companies for
those services
The companies pay the network
owner (the group of cities) for use of the fiber, and
The network owner (group of
cities) pays off the bonds.
The Morning News was skeptical whether the
network would break even. Here's what has to happen--see what you think:
By the fourth year of operation...
30% of households and businesses
in member cities have to...
sign up for at least one service
over the network (phone, TV, Internet, video on demand, etc.).
That's all it will take for the network to
pay for itself.
Provo City 's pilot project (not part of
UTOPIA but using the same technology) signed up over 40% in the first year
alone. Spanish Fork's municipal cable system attracted 45% of residents in its
first year.
With those facts in mind, I have to
respectfully disagree with the News' conclusion that they "don't hear an
overwhelming demand from the public for this" and that "most
residents seem satisfied with the Internet and cable services offered" by
the current providers.
We hear the demand from citizens, families and businesses.The city councils and mayors of the 18
cities that are members of UTOPIA talk to the citizens and businesses in our
cities. We hear the demand, even if the Deseret News does not.
Cities have been working on this in public
meetings over the last 18 months. Businesses and consumers are excited about
it. Independently-verified feasibility studies indicate that over two-thirds of
residents say they would buy services from competitive providers over the
network. As we talk to citizens, even when they understood it involves city
loan guarantees, they are virtually unanimously positive about the concept.
If you want more choices in telecom, please say so NOWWe have one crucial step remaining to make
the project a reality and give telecom choices to our citizens and businesses.
The city councils of the member cities have to take final votes on pledging to
financially back a portion of the bonds-essentially "co-sign" on
about half of the loan.
Qwest has made it known that they intend
to keep the councils from voting in favor of the pledge. They want to kill the
project. In other states, the incumbent service providers have used all kinds
of scare tactics and threats to confuse the public and weaken the political
courage of city councils.
Here's where you come in. This week, we
are forming a coalition of citizens, businesses, educators and government
leaders to support the concept of the community digital pipeline:
Utahns for Telecom ChoicesThis coalition is not a governmental
entity and will be privately funded. Its purpose is to spread the word about
the new model of a community-owned network open to many service providers, and
to make sure city councils know that they have the support of the overwhelming
majority of the citizens and businesses in their areas.
We'll have a web site up sometime soon
with complete information, but meanwhile we need to hear from you. By replying
to this email, you can add your name (and that of your organization) as a
charter member of Utahns for Telecom Choices.
To add your name to the list, please send
a short message to me at
telecomchoices@hotmail.comgiving your permission for your name to be added to the list of public
supporters of the UTOPIA Community Digital Pipeline project.
Please forward this message to everybody
you know who may be interested in this project. We need all the help we can
get.
Let's make sure our city councils know
that we support their efforts to give us more choices in telecommunications
services. Bring on the bandwidth!
Daniel C. Snarr
Mayor, Murray City
Advisory Board Member
Utahns for Telecom Choices
telecomchoices@hotmail.com My favorite predictions about the adoption of new technologies"This telephone has too many
shortcomings to be seriously considered as a means of communication. The device
is inherently of no value to us."
Western Union internal memo, 1876. "The wireless music box has no
imaginable commercial value. Who would pay for a message sent to nobody in
particular?"
David Sarnoff's associates responding to his urgings for
investment in radio. "I think there is a world market for
about five computers."
Thomas Watson Sr., founder of IBM, 1943. "There is no reason anyone would want
a computer in their home."
Ken Olson, president and founder of Digital
Equipment Corp., 1977. "[Fiber-optic's capabilities] are way
more than what most consumers need in their home. Why provide a Rolls-Royce
when a Chevrolet will do?"
Jerry Fenn, Utah President of Qwest, 2003 _________________________
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