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Technology Stocks : The *NEW* Frank Coluccio Technology Forum

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From: Frank A. Coluccio4/20/2006 12:49:42 AM
   of 46821
 
Editorial: Setting the Record Straight
A Message from Tim Hacker, Mesquite City Manager
April 17, 2006

[ from the Baller.com list ]

mesquitelocal.com

There are certainly many opinions being circulated in the Mesquite community regarding the City’s efforts to secure state of the art broadband connectivity for our self, other governmental entities, current and future residents, educational, medical, and business interests. After reviewing some of the more disturbing misinformation that is being distributed, I felt it appropriate as your new City Manager to offer some clarity on this matter. I hope you will appreciate that my opinion is not tainted by past relationships with any organization or effort related to broadband services in Mesquite as I am new to the community and organization, having arrived in early February of this year from Illinois.

When individuals speak of broadband they are talking about the ability to provide voice, data and video services over some means including traditional phone or cable wire, wireless microwave, satellite or fiber optic cable. From all of these options the only means that has a capacity yet to be determined is that of fiber optic. The only limits to fiber optic capacities are the limits of the equipment hooked onto either end, and with each new generation of equipment produced with dramatically increased capacity and speed, fiber optic cable has proven capable of handling the same at the fastest speed known to exist: light speed. Fiber optic uses light to transmit data, and no one can question that light is the fastest known means to accomplish this task.

Currently there are two campaigns underway regarding the City of Mesquite’s efforts to secure state of the art broadband connectivity for our community. U.S. MetroNets, a firm that has a relationship with the City as a result of a public, intensive, detailed, qualification-based solicitation generated by the City, is undertaking efforts to both gauge residents service desires for telephone/cable/internet as well as meeting with groups to help educate them on what the City desires for broadband services today and well into the future. A local incumbent provider of telephone/cable/internet services is also waging a campaign. Unfortunately this campaign is not to gauge customer satisfactions, wants, desires or to inform customers of the services they provide, but is merely a campaign aimed to distort facts and tear down what others are proposing. I have always questioned the motives of those who undertake such campaigns, as you will quickly determine they are self serving.

The City of Mesquite’s interest in improving broadband is to serve the needs of our community today and well into the future. Improved broadband will result in improved voice, data and video capabilities, and will enhance connectivity with government, education, library, medical, media and the many, many other markets now available over broadband. High-speed broadband connectivity will be a key driver of economic, technological and societal growth well into the future.

Having an internal fiber optic network sounds great, but unless it is directly hooked to a high-speed fiber connection to the world wide web, it is like feeding a large diameter water pipe with a garden hose. That is what stand alone communities like Mesquite have been forced to endure, and that is why communities across this nation are becoming interested in partnering to secure state-of-the-art broadband connectivity.

The current residents of Mesquite certainly deserve better service options, and the benefits of enhanced competition that the City of Mesquite is pursuing. I find it amusing that anyone would question that the City is going to pay for the professional services of a firm like U.S. MetroNets. If you hire an architect you must pay for their services. If you hire an engineer you must pay for their services. If you hire a manager you must pay for their services. That is what our professional services agreement with U.S. MetroNets boils down to: design, financing, bidding, awarding, construction oversight and ongoing management services. The City, and any other company or individual for that matter, will pay for such professional services for any project it undertakes. The percentages or total amounts agreed upon for these services are well under traditionally accepted rates, and I am guessing far below the profit our incumbent providers now enjoy.

The City’s motivation to undertake this project isn’t new, and isn’t a reaction to any single incident or concern. The City has tried to work with local providers since 2001 to encourage enhanced broadband for our community only to have such inquiries outright ignored, or to be told that the community didn’t need better levels of service. That is like going to a car dealer and being told you can have any car you want, as long as it is the one model on the lot and also the color of that particular model on the lot. If the local incumbents or some other private entity would have been more responsive and proactive the City would not have gotten involved.

I read a local editorial that likened the City’s involvement with this broadband initiative to that of the extension of the railroads across this great country years ago. That is a pretty good analogy, as without the United States listening to the outcry of the citizens of the day for this state of the art transportation service, and without the United States listening to the pleas of the private rail companies for assistance in the form of grants of huge tracts of land that could be sold to finance the same, the rail roads would not have crossed the United States until a much later date.

Seldom has a new technology or other advancement taken place which hasn’t started as a government initiative. Ironically, it is the private sector that usually pursues government assistance for research and development, and then when the new technology is in the position to be marketed and determined to generate a profit is when complaints surface that government shouldn’t be involved.

Broadband is the latest technology and infrastructure that the residents of Mesquite and other stand alone communities must harness if we hope to reach our potential and remain competitive with other communities. Doing nothing has gotten us to where we are at, and remaining placated with the promises of better things to come seems to only have gotten us over five years behind where this community should be at today with broadband options.

The last item to address, and the one that most are concerned with, relates to the structure of the financing for this broadband project. Although some in the community refuse to believe it, the City of Mesquite will have NO obligation for the retirement of the bonds or other financing issued for this project. Even if the wishes of the vocal doubters come true and the project fails after it is constructed, the City would still have NO obligation for the debt. The bankruptcy court would take receivership, and a steward or trustee would be appointed to oversee the continued operations until a buyer or successor was determined.

Here is the bottom line. The City of Mesquite became tired of unfulfilled promises and non-responsiveness from our primary local service provider. Our City leaders understand the economic and social benefits of high speed broadband deployment is crucial at this time, and have taken a proactive role in determining the speed with which high-speed fiber optic broadband infrastructure is planned and deployed. The City must provide the necessary pressure to ensure that the community’s needs are met. The City believes that the end result will be much better services at cheaper costs, providing enormous benefits to the citizens, and a more level field for future competition for these services. A likely consequence may result in one business seeing profit margins greatly reduced due to competition, and that’s a picture they simply don’t like.

Although I have used very simple terms and approaches to explaining this complex matter, I hope you will appreciate that it is the City of Mesquite and our partner U.S. MetroNets who desire to educate and answer your questions and avoid providing false or misleading misinformation that is only intended to scare and unnecessarily alarm our community.

I may be a new face to government here in Mesquite, but I am by no means new to local governmental operations and finance, and not afraid to openly share information and work to overcome any misconceptions that may exist about the importance of state-of-the-art broadband services to Mesquite today, tomorrow and well into the future.
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