convinceme
@chcgil.ameritech
| Speaks for itself.
"If the utility did not attract enough subscribers to financially succeed, taxpayers would be left with the bill and stuck with paying the bonds."
Can someone from Tri-Cities, please, please, please, assure me this statement, lifted directly from the Kane County Chronicle article, is some nasty SBC/Comcast lie and not a single penny of taxpayer dollars are at risk?
I also want to know who will put up the "seed money" and pay the overhead and interest until this brilliant idea takes flight and starts turning an alleged profit.
If you can do all that, I'll vote "yes" this November.
I live off Route 38 and can't get broadband. But I don't expect anyone else to pay for my ticket.
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batageek
Slave To The Duopoly
Premium
join:2003-01-25
Batavia, IL
edit:
March 28th, @10:00PM
| OK. I'll take a stab.
The feasibilty study done for the April 2003 election showed quite clearly that with limited take rates for cable, internet, and phone services, the construction and operation of the plant was easily possible.
From »www.tricitybroadband.com/answers.htm
How much of the market share do you need to get to make this project successful? (I heard you have to get 30% right away--most companies are lucky if they get 7-10% penetration, after they spend $ millions on advertising and marketing.)
The Feasibility Study projected that we should get up to 34% of the residential cable market in our area, but we need to get less than 25% for cable, less than 4% for Internet, and about 5% for telephone to break even. And we don't need those percentages on day one. Remember, the repayments are spread out over 15 years.
Also see »www.geneva.il.us/bb/faq.htm
If you read the study, you'll also see that the overhead and interest were built into the bonding structure for the first three years. See »www.geneva.il.us/bb/Broadband%20Sect2.pdf , page 35
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»www.tricitybroadband.com |
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nunya
SEE ROCK CITY 475 MILES
Premium,MVM
join:2000-12-23
O Fallon, MO
clubs: | reply to convinceme
The bonds are backed with taxpayers dollars. |
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batageek
Slave To The Duopoly
Premium
join:2003-01-25
Batavia, IL
| Yes....with almost zero possibilty of the taxpayers ever having to fork over cash because the study showed that rate payers alone (read just those that take service, again not mandatory) would pay off the bond obligation.
The only way that property owners would ever see a hit is if:
1. No one signed up for service.
and
2. The city had absolutely no use for such a plant - like to serve existing electric and water customers.
and
3. The city could not lease the plant to a private sector company.
and
4. The city could not sell the entire plant.
Then, and only then, would taxpayers see a hit.
The TriCities would also have to be the first failure of its kind in the country.
I'm feeling pretty secure in the risk level.
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»www.tricitybroadband.com |
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Octopussy2
Premium
join:2003-03-30
Batavia, IL
| reply to convinceme
Get registered to vote once you read all the supporting material. www.tricitybroadband.com
The vote last year was 40% in favor of creating this utility. That represents to me that statistically 40% of the people were willing to take services from the cities.
Failure wouldn't have been realized, and in fact, public sentiment regarding Comcast and their substantial rates increases since last year have tilted the playing field more in municipal broadband's favor.
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It's muni-licious! »www.tricitybroadband.com |
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mocycler
Premium
join:2001-01-22
Naperville, IL
 ·AT&T Midwest
| reply to batageek
Don't talk like a politician. You didn't answer the question.
You say how easy it is to "break even". But to do that you must built the plant in the first place. Who will pay the up-front costs of building the plant (before you even sign up customer #1), and who will eat the costs if the deal fails? It's a legitimate question.
said by batageek  :
The only way that property owners would ever see a hit is if:
1. No one signed up for service
2. The city had absolutely no use for such a plant - like to serve existing electric and water customers.
3. The city could not lease the plant to a private sector company.
4. The city could not sell the entire plant.
1. Not likely. A trite point.
2. What other use would there be, besides broadband? Until someone finds a way to send water and electricity down a fiber optic cable, this is a completely ridiculous argument.
3 & 4. Yeah, but who pays the upkeep & interest while you are shopping for a lessee/buyer, a process that can take months or even years?
Many unresolved issues. Too many vague answers. Tricities doesn't care because someone else will pay if they wrong.
Peace,
mocycler
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batageek
Slave To The Duopoly
Premium
join:2003-01-25
Batavia, IL
edit:
March 30th, @11:24PM
| Ok here we go again Mo'
How many times can I say it ....Build cost and the expected downtime before turn on are factored into the entire bond amount. The TriCities expect to lose money for the first couple of years, so they've rolled more cash into the bond amount to cover the early years.
To your points:
1. Ok so technically no way the citizens are going to be on the hook for the full amount. Maybe trite but true. Just think of what that dollar amount is....
If they build the whole damn thing and shut it off, never to offer service, the owner of a $200,000 home would be on the hook for $15.00 a month for 15 years.
Now apply this logic...Comcast alone has raised rates for the standard package plus one premium (a very common package) from $48.47 in January of 2003 to $64.99 in February of 2004. What's the price difference? $16.52.
Then apply price increases for telephone and or internet...
Geez Mo, your rates may not be this high (you've got direct cable competition from Wide Open West in Naperville), but ours are.
People are already getting taken by Comcast in an amount greater than what they'd be paying to build the whole damn plant and shut it down.
Yes I know....Comcast is an option, and a tax increase is not, but most people take cable tv (or dish) at their home anyway. For the majority of people, cable tv is a monthly cost, just like gas or electric.
2. Meter reading and electric/water use controls. Being from Naperville, you should understand the value of muni electric...your rates are cheaper than those around you paying ComEd.
3 & 4. either way, the value of the plant exceeds its build cost. They've got a turnkey plant that can be leased to whomever to provide whatever. If it fosters competition on any front, the citizens benefit. Look at this article.. »news.com.com/2100-1034-5165223.html ....sounds like AT&T might be interested.
For God's sake Mo, try to have even a shred of big picture vision and you'll get this. These things aren't failing (a point proven over and over again). Just cop to the "government shouldn't compete with the private sector" argument and be done with it. Be a killjoy and say it's to hard or can't be done, but at least look at the whole picture before you do.
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»www.tricitybroadband.com |
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