Google Fiber rescues Provo; what about UTOPIA?

UTOPIA has reacted to Google’s decision to take over Provo’s public fiber optic network by touting it as a vindication of its own business model. It “validates the vision our member cities have been working toward…” a statement on the consortium’s web site says.

That’s not the story I’m hearing from the people involved in the Provo deal.
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Thursday morning I was part of a meeting between Provo Mayor John Curtis, Google officials Matt Dunne and Jenna Wandres and the Deseret News editorial board. Mayor Curtis was frank about where the city found itself with its broadband venture once known as iProvo. Ten months ago, the city put out a request for proposals, hoping to attract some group or entity to buy the thing.

“Originally, we wanted to sell it for cash,” he said. “But it became evident no one would pay cash.” The thing was worthless. “Potential buyers looked at the network and said it’s not worth anything.”

And why was it not worth anything? Because the technology the city bought with bond proceeds several years ago is now hopelessly outdated.

In a nutshell, this is the problem when public entities try to compete in a fast-moving industry such as Internet delivery.

Curtis can afford to be frank. It wasn’t his decision to invest in iProvo. When he took office, his challenge was to figure out what to do with it.

While the fiber optic cable the city had planted remained good, everything else about the system needed a serious upgrade. Curtis said he faced the prospect of either asking Provo residents to assume a lot more debt to bring everything up to date (only to watch it deteriorate again with time), or eventually having to shut it all down.

Instead, Google Fiber came along and saved the day, offering to assume the fiber optic infrastructure and make Provo the fourth city in which the Internet giant will provide broadband virtually free to anyone willing to pay a $30 hookup fee.

Google will assume all the risk and keep the technology up to date. It will not, however, pay off Provo’s 10-year-old debt obligations connected with iProvo.

The city still has to do that, and it’s a big reason why iProvo still was a bad idea. The city got lucky. If Google didn’t come along, it would be stuck.

UTOPIA stands for the Utah Telecommunication Open Infrastructure Agency. It is a consortium of 11 cities that have pledged a portion of their tax revenues to form a fiber optic network. It also has been in financial trouble from the start. Its subscription levels have remained below expectations, and it has repeatedly come to member cities asking for more money.

We asked the Google people about UTOPIA. They said it wasn’t the first time they had fielded that question since arriving in Utah to announce the Provo agreement. But they clearly haven’t been in discussions concerning any similar type deal.

Other officials told me privately it would be difficult, and maybe even impossible, to negotiate a Provo-type deal with 11 separate mayors and city councils. Provo has a built-in high-tech community ideal for Google Fiber’s model.

Good for Provo. In a little more than a decade from now its iProvo debt will be paid and it can move on. Who knows what the cyber world will look like by then.

Categories: Utah issues

About the Author

Jay Evensen

Jay Evensen is the Senior Editorial Columnist for the Deseret News. He has 32 years of journalism experience covering politics and a variety of other assignments at news organizations ranging from United Press International in New York City to the Las Vegas Review-Journal and the Deseret News, where he has worked since 1986. During that time, he has won numerous local, regional and national awards. Most recently, he was given the Cameron Duncan Media Award, given annually in Washington, D.C., by the advocacy group RESULTS, to the journalist judged to have done the most to further the cause of the world's poorest people.

2 comments

  1. Ronald D. Hunt

    “The thing was worthless. “Potential buyers looked at the network and said it’s not worth anything.””

    I have said the same thing about several used cars I have bought, No buyer is going to negotiate over an item of non-fixed value by starting at its quoted or suggested price.

    “asking Provo residents to assume a lot more debt to bring everything up to date (only to watch it deteriorate again with time)”

    The 100 Megabit fiber electronics used by Provo are still 80 times faster then the junk DSL connections that Qwest sells, and 4 times faster then the Copper from the node network(FTTN) that a few select area’s are lucky enough to have.

    Nor does their technology even as it is 10 years old suffer from peak congestion problems like Cable docsis 3.0/2.0 does.

    IProvo’s failure has nothing todo with a public Utility being unable to keep up with technology changes, It has everything do to with exclusive contracts given to private corporations that are inadequately equipped to handle the job, service interruptions every time their new exclusive contract company imploded.

    This left customers weary of the network, suppressing the value of the network due to the shear lose of good will towards the thing.

    On this front Google is the best deal they could have gotten, Nothing less then a phenomenal national brand that can be immediately trusted would work to save the thing.

    Now as for Utopia, they are not in the same boat, Utopia has never once had customers suddenly lose service, or had their service level drastically reduced because the new provider can’t handle them. On the occasion when Utopia had a service provide go bankrupt they had planned in advance and moved the customers over to other providers gracefully without service interruption.

    Being an open provider network they have many providers, including several Utah based businesses, and that keeps money in our local economy. And if you don’t like one you can fire them and pick a different provider, You can’t do that on Qwest or Comcast, or if you are in Tremonton you simply couldn’t get service prior to Utopia, as Frontier communications only installed DSL after the city signed on for Utopia(not that 1.5-7meg ADSL “competes” with 100meg Fiber).

    And Utopia has improved from the bad business plan they started with, They have a new business plan and it is working, They received money from the ARRA stimulus bill.

    I would suggest looking into the UIA(Utah Infrastructure Agency), which is where much of the networks expansion is coming from, And is part of the new business model, it is also designed to transfer cost of the networks bonds from the tax payers to those using the network.

    And one other thing I will point out, Utopia’s network is carrier grade, IProvo is not. Utopia can and does sell backhaul connections to businesses, in both 1Gigabit and 10Gigabit speeds, More then a few businesses have rented offices in Utopia cities for the purpose of locating small scale datacenters, or ran Utopia fiber for cell towers.

    There are good reasons many of the cities still defend Utopia, and in Layton at least we will kept electing the people who signed onto this thing as have done so every election sense its inception.

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