I received word from a reliable source at a service provider that Broadweave may be considering joining UTOPIA. This information was passed along from a company that both of them do business with. According to this company, Broadweave has stepped up its outsourced call center operations in preparation for adding new customers on UTOPIA’s network.
UTOPIA and Broadweave have had an acrimonious working relationship in the past stemming from the entanglement between UTOPIA and iProvo regarding the head-end assets. This was no doubt hurt further by ex-CEO Steve Christensen’s forceful and demanding management style. The question is if the upending of upper management is enough to mend the relationship to the point where this rumor becomes fact.
If true, this would be a really good (and smart) move for Broadweave. They’ve hit a brick wall with adding customers on iProvo and are under a “do or die” deadline of February when the reserve runs out of cash. The rumors that they will soon be booted from Traverse Mountain also persist, though nothing new has developed. Getting access to the tens of thousands of UTOPIA homes passed and preserving some of their Traverse Mountain customers could give them the revenue needed to pay off the iProvo bonds and better leverage their head-end and NOC facilities.
Of course, we should also ask if Broadweave would be good for UTOPIA. Customer service complaints still persist and the company may not have the cash available to market to new customers unless EsNet makes additional investments. Broadweave has also failed to deliver video to Traverse Mountain despite the acquisition of a head-end, something I understand to be one of the main reasons for that development’s discontent. There’s also the matter of going from a geographically condense market to one spread over a 120-mile stretch, something that could drive their install costs up.
We should also wonder if Broadweave joining an open network like UTOPIA would signal that they’re ready to give the wholesale model another shot in Provo. Apparently closing the network wasn’t enough to staunch the flow of red ink as they claimed it would. Outside providers have money to spend on snapping up new accounts while Broadweave is charging around $600 for installs (and, I should note, not offering a discount on monthly service as a result). It’s entirely possible that a reciprocity agreement with UTOPIA providers to give them access to the network could result in higher overall revenues even at the expense of retail customers. Research from The Yankee Group suggests that an open provider model generates more revenue than adding lots of extra services, revenue that Broadweave needs.
So what do you think? If this happens, will it be good for Broadweave, UTOPIA, both, or neither?
That sounds like that would be good for all party’s involved. if iprovo where to interconnect with utopia would be win for both sides.
I’m a sales contractor for Broadweave and not an employee. I’d like to add some of my own personal opinions/insights.
I’ve done residential sales part-time for them since October. I’m not a regular sales guy — I’ve been doing website development/consulting and all around home and business computer help/tutoring on the side for over 10 years now. I’m not one of those stereotypical sales hypsters that unfortunately most companies have it seems.
I’m more of a consumer advocate than a sales person — have been a whistle blower in the past but that’s another story for another day.
I’d like to first say that I sometimes refer people to Utopianet — people that call from Orem asking if Broadweave services Orem and so I refer them to Utopianet.
I haven’t had time to think about this news/rumor a lot but it sounds good to me so far.
I also wouldn’t say that Broadweave has “hit a brick wall” on adding customers. If they had, I wouldn’t have stayed with them for as long as I have. I’m making sales regularly. And I definitely hope to continue to be doing contract work for them way beyond next February.
And in my opinion, they’ll turn it around — yeah, i’m just a lowly sales contractor but take it for what it’s worth — i have a very strong technical background.
Also, as part of ProvoCitizens.net I actually campaigned against the iProvo $40 million bond back in late 2003 and early 2004 — ProvoCitizens.net helped pass out hundreds if not thousands of fliers trying to get citizens to come to the public hearings on it. I remember one of the guys on the city committee for it got up in my face before the meeting when we were picketing outside.
Kind of ironic how things work out — since i originally opposed iProvo and now I’m doing work for Broadweave. 🙂
And whether the closed or the open network model, i think it can work both ways.
Just my 2 dollars worth(adjusted for inflation — “i want my $2!” 😉 )
Thanks for this website,
Roger
The cash issue is a definite brick wall. Unless EsNet or another investor puts some more into it, Broadweave will have to seek out increasingly difficult to obtain financing to pay for installs and marketing. The deadline to get that done is February when the surety goes dry. Dave Moon has already said that they intend to use the surety into next year. Unless there has been some kind of dramatic change that none of us are aware of, it would appear that Broadweave would have to find a big bucket of cash and use it to sign a few thousand more customers in just 6 months. Even the best providers on UTOPIA aren’t likely to pull that rabbit out of their hat.
Its hard to talk negatively about Broadweave going to Utopia, or about the financial woes of Broadweave because nobody knows what financial situation they are in, not even Jesses Aunt. Utopia is a sinking ship. It does not matter who gets on the Utopia network, it will not save it. It is in financial ruin, nothing will change that. Maybe if Broadweave gets on to the network it will make it that much easier to take it over when it fails like iProvo did. It seems somewhat one sided to harp on Broadweaves financial state, when Utopia is 14 times as large and in 14 times more financial trauma than iProvo was. Lets not let our individual agendas shadow the true sinking state of the open infrastructure model. Even the city of Provo recognized it as a losing model. Todd Marriot would be wise to look at the historical financial difficulties of iProvo and try something “unique” as opposed to try and duplicate a failed business model with a bigger smile than the Provo mayor. What was the saying again….”you can market that the pig isn’t a pig and its still a pig”….no…..”you can put a wireless keyboard and network engineers in front of a pig to reprogram the pig and its still a pig”…no….”you can talk positively to a pig and talk it out of pigness”….no….”LIPSTICK, you can put lipstick on a pig and well, I think you get the point.”
ridicules, Everything that is known suggests that Utopia is doing just fine, yes they will call on the tax pledges, but that hardly indicates financial ruin. Unless you happen to have new information that is unknown to the rest of us your just spouting idiocy.
Their adding new customers everyday, Their running the wireless back haul for Fuzecore, They have signed on many new ISP’s with indications that their are yet more coming to sign on. Against all educated speculation it sounds like they are pulling off the SSA expansion in Brigham city. Their going to start offering a whitebox video service soon for all the ISP’s to sell.
Their is more then enough good evidence to show Utopia is improving their business everyday. To say nothing of the very high level of customer satisfaction, increased business activity, And new business’s moving into Utopianet City’s.
Chandler/Tony/string cheez (yeah, I know who you are): There’s some big differences between Broadweave and UTOPIA. For one, Broadweave has a limited pool of money to call on for bond service that exists so long as EsNet (or another group of financiers) chooses to keep the money flowing. UTOPIA has the option to tap pledges for bond payments, a source of revenue that’s all but guaranteed. (I suppose a city could default, but that’s financial suicide.) Yeah, it sucks for those cities, but when you think about it, they’re really just paying for their part of the network instead of getting it for “free”.
There’s also a big difference in the customer base. The takeover of iProvo was relatively easy since so many of the customers were concentrated in a single service provider, one that was in no financial position to resist a takeover. Buying out all of the UTOPIA providers to end the open wholesale model would be tricky and ultimately prevents its sale.
I’d also point out (rather bemusedly, I might add) that you heavily criticize the open model as the problem, yet Broadweave can’t seem to make ends meet with the closed model either despite a bunch of claims that this was THE issue. And they raised prices to boot. The Yankee Group did a study that an open model with lots of providers pays for the network faster than a closed service provider model. Saying that open models are a failure is either woeful ignorance of how fiber networks operate or intentional lying and misinformation for an ulterior motive. Either way, you’re an idiot.
So, Chandler/Tony/string cheez/Steve Christensen, please crawl back into whatever hole you came out of and continue to lick your wounds at being deposed from your company due to your half-assed management that lead to Traverse Mountain thinking UTOPIA is a better fit than you are. (Oh yeah, I went there.) Five years from now, UTOPIA will be a success story and Broadweave will likely be another casualty on the overbuild highway.
PS Melanie McCoard is my wife’s aunt, not my aunt. If you’re gonna get personal, at least use accurate facts, would ya?
I find the responses to Chandler disturbing.
I think that personal attacks and public exposure are not appropriate responses to his opinions.
I have often (usually) expressed opinions that were not popular and other than a very few posters, I was not attacked personally or this badly.
On Open vs. Closed:
I’ll note that the Yankee Group study is a theory from that group and under the exact conditions of their model, the open network worked better. The reality is that we don’t have a successful open access model to point to that supports that opinion. Personally I believe under the right conditions, either model might be successful, but the evidence we have only shows the closed model to be successful.
(Let’s also remember that Broadweave wanted to be the only provider and they have not been able to try that model. NuVont remained on the network for over a year and Veracity is still on the network.) Sadly, both iProvo and UTOPIA failed at the open model. (Success being a financially successful operation as the Yankee Group likely modeled?)
On UTOPIA being in financial ruin:
I have repeatedly pointed out that UTOPIA is 1/2 a BILLION dollars in debt and in my opinion, in much worse shape than Broadweave. I believe that Broadweave is actually operating cash flow positive (no one really knows, but since iProvo was operating cash flow positive and I believe Broadweave reduced expenses while increasing revenues, I feel it’s possible/likely they are cash flow positive.). It appears from the latest UTOPIA budget that they are NOT operating cash flow positive after all these years?
(Sadly, cashflow positive is not good enough, but it’s your not even cashflow positive you are in deep do-do.)
I see only 1 scenario that UTOPIA could present that would make them a success (defining success as financial success, subscribers paying costs)…..if they got bailed out…free money from the government that they did not have to pay back…stimulus money…and lots of it. Other than that I think Chandler is right…they are in financial ruin and nothing will change that.
On City backing vs. EsNet backing:
I’m not sure I would count on the cities continuing to dump money into UTOPIA. I suspect they will likely want to cut their losses, sell at the first opportunity and lick their wounds. I suggest the cities will look for a buyer as soon as they start paying the bond (if they are not secretly already doing so).
Currently cities are not paying for UTOPIA. As soon as they start, as soon as that first payment is made, where cities (including those with little or no fiber) are taking cold hard cash in these very tight times and pay the bond (and operating costs?)…the political winds will shift. As cities have set aside money this will not be too bad….but that money will run out. Then it will get ugly fast!
Before too long it will reach a point where cities may have to either raise taxes, cut funding to programs or lay off employees to pay their UTOPIA debt. (Does anyone doubt this will happen?)
On Todd just smiling:
I do think Chandler is wrong in saying Todd is not trying something “unique”. I think the SAA is “unique”. (I don’t believe it will work, but it does show they are thinking outside the box (and grasping at straws?).
In Conclusion:
So let’s show Chandler a little love and if you disagree with his assessment of UTOPIA…SHOW HIM THE NUMBERS. Let’s talk business plans, and budgets. Subscriber numbers and Avg. Revenue Per Subscriber. Operating costs and debt payments vs. revenues. These are the things that will make or break UTOPIA (or any company).
Capt: I’m a little sick of this particular sock puppet. His past posting behavior shows little willingness to be constructive at all. If he wants to be an ass, let him be an ass with his own name or a consistent name instead of using five different pseudonyms. And while I’m convinced that this particular asshat is Steve, I don’t have hard evidence. Just my gut feeling. At least I have the common courtesy to insult an individual instead of dragging family into it.
While “Chandler” spends all of his time saying the open model is broken, we again come back to the point that Broadweave, despite potentially being cash-flow positive, can’t make the numbers work either despite the closed model. That’s even after raising prices by the exact amount Provo City needed to in order to make up the shortfall in bond payments and adding in the retail revenue. Given that, I don’t for a single instant buy the “increased efficiency” argument. His rant is ill-informed tripe that ignores reality. Amazing how UTOPIA detractors have such a short memory for these things. Pardon my annoyance, but I have a very low tolerance for repeating myself on basic historical facts and dealing with spin.
The core points are that overbuilding is very expensive and often won’t pay for itself very quickly. We also cannot keep putting all projects into a single boat. iProvo’s failure (past and present) have completely different causes than UTOPIA’s failures and different causes from American Fork’s failures. Ignoring the differences between the projects is intellectually vapid at best and flat-out intentional lying at worst. When someone engages in that kind of unintelligent rant, you can bet it pisses me right off, especially when combined with a healthy dose of arrogance.
And honestly, this has strayed pretty damn far from the original topic. I was hoping for a better discussion and tried to give Broadweave an even hand in the original post. I can see that the effort was completely wasted.