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Service Provider Mobility: UTOPIA, Perfectionor Fantasy: Partnering public-private sectorswith broadband

Posted by Leonard Grace May 9, 2010

Utopia: the definition brings about visionsof an “ideal place or state”, or “a system of political and social perfection.”Thus became the name chosen for a consortium of sixteen Utah cities buildingtheir own broadband infrastructure with a fiber-to-the-premise architecture,while offering residents a clear and alternative choice to incumbent operators,including Quest and Comcast.  Is it perfection or fantasy?

UTOPIA, billed as providing light-speed to your door while connecting you with friends,family, entertainment, businesses, healthcare, and education, highlights itself as being partof your home, not owned by any network provider. It is unique in that UTOPIA is part of acombined network owned by connected cities, and therefore citizens of each community.It allows any network provider to use the infrastructure to offer related consumers servicesin an effort to create more competition within the broadband universe, and to provide ruralresidents state of the art fiber connections to their homes.

Overview:

• Maintained by city employees, UTOPIA requires a deposit to participate just ascitizens would pay for a sewer connection to their home

Service Provider Mobility: UTOPIA, Perfection or Fantasy: Partnering public-private sectors with broadband

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• A monthly service fee is charged to maintain the system which includesmaintenance, and billing just as with electric, water & sewer services

• Open Access Network – open to various service providers which have access tothe network

UTOPIA Service Providers:

Brigham.net

Prime Time Communications

Connected Lyfe

Nuvont Communications

FIBERNET

Veracity Communications

FUZECORE

integra TELECOM

Telesphere

XMISSION

VOONAMI

Currently with eleven listed service providers using the network, UTOPIA is offering avariety of services to residents within its service area. In the past two years since hiring newmanagement, subscriber growth has doubled from previous levels beginning from 2002.UTOPIA indicates a need to add another twenty thousand customers quickly to ensure thelong-term viability of the consortiums investment.

Service Provider Mobility: UTOPIA, Perfection or Fantasy: Partnering public-private sectors with broadband

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This venture is similar to what Google has committed to accomplish with its advertisedforay into the broadband infrastructure arena touting network speeds one-hundredtimes faster than those typically offered today. Goggle will also operate an (open accessnetwork) allowing multiple service providers to offer subscribers a wide variety of enhancedapplications and services. See (Think big with a gig: Our experimental fiber network)

Divergent Industry Infrastructures

Historically, Cable operators have chosen the hybrid-fiber coax architecture to build out theirnetworks, with Docsis 3, and GPON to gain efficiencies in bandwidth. Others like Verizon,UTOPIA, and now Google have opted to use fiber-to-the-premise, a total fiber network toconnect customers to a true high-powered and hefty bandwidth architecture, which can offerdeep access to both existing and future applications.

While the hybrid-fiber-coax construction is less expensive on the front end, it is notconsidered the long-term or end game solution. Total fiber construction is more expensiveon the front end, but as costs continue to come down more service providers will opt toconsider this solution.

Perfection or Fantasy

UTOPIA, Verizon, and Google’s networks will have to be proven profitable both inthe short and long-term to be considered viable alternatives in private industryadoption. The heavy capital expenditures on the front end for fiber-to-the-premise construction must be coupled with robust adoption by customers to notonly reach a break-even cash flow standpoint, but go on to make a reasonableprofit.

This will be critical in obtaining needed capital for companies going forward, where UTOPIAis using bond issues along with pre-paid deposits and long-term subscription agreementsto fund its venture. There is no doubt that fiber-to-the-premise is robust alternative from

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an operational standpoint with its high speeds, hefty bandwidth, and future applicationspotential.

125 Views Tags: network, service, access, provider, broadband, verizon, open, google, comcast, utopia, fiber-to-the-premise, quest

May 10, 2010 11:07 AM Kittur Nagesh

Thanks Leonard for an interesting topic.

As you know, competition is good for all of us, especially for the consumer. Customers, ingeneral, think applications and social/business context. The network is expected to workwell. Often the operator gets the blame when something goes wrong, doesn't matter if it isthe application or the device.

IMHO, a successful consortium achieves the following:

• Creates a compelling base offer and constantly innovates around it to staycompetitive.

• Executes on a common purpose while ensuring compliance to regulatory policies.Sometimes, profit-motivated enterprises may have a vested interest in theconsortium. The net neutrality debate has clearly exposed this.

• Has a long-term view of the benefits to the ecosystem and the society• Demonstrates open access to membership, decision making positions, etc.

In the case of telecom consortium, the cities (and its citizens) should believe in the valueof the broadband enablement and fund appropriately or create viable apolitical businessmodels.

How do you compare UTOPIA against these guidelines? If executed right, other cities mayfollow UTOPIA model!

Regards,

Kittur Nagesh

Service Provider Mobility: UTOPIA, Perfection or Fantasy: Partnering public-private sectors with broadband

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May 10, 2010 12:20 PM Leonard Grace Kittur Nagesh in response to

Kittur, thanks for the great comment!

While recently attending the 2010 Broadband Properties Summit in Dallas, TX, I had achance to meet with both UTOPIA representatives, and Keynote Speaker, Graham Richard,former mayor of Fort Wayne, Indiana, and founder of Graham Richard Associates.

Graham created a roundtable from a small group of individuals interested in the proliferationof broadband to study, collaborate, and make recommendations going forward, in helping tocreate partnerships with cities/communities in bringing broadband to Rural America.

This meeting led to my article on UTOPIA, in highlighting what communities can accomplishwith public/private partnerships in moving a broadband agenda from inital ideas toconception. With the right research and development of a combined entity committed to astate of the art telecommunications infrastructure, good things can happen.

It involves thinking innovatively and purposefully for both short and long-term funding,long-term collaborative involvement from all community members, while creating the rightmanagement team with sound financial and operational experience for future success.

The open network concept helps create local jobs while giving the community tools to:

• attract and retain good paying jobs for all concerned• create e-educational opportunities for all citizens• create e-healthcare opportunities for all citizens• create e-energy efficiencies for business, government, and residential customers• improve to overall standard of living for citizens

Service Provider Mobility: UTOPIA, Perfection or Fantasy: Partnering public-private sectors with broadband

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Communities working together can make a difference in the health and welfare of itscitizens. It takes a long-term commitment to political, social, and fiduciary responsibility tomake it happen.