The writer noted that organizers said one of every three households needed to sign up for broadband along the UTOPIA network in order for it to be successful. Then he went to the dictionary for a prediction of what would happen. Webster’s, he wrote, defines utopia “as an ‘impractical scheme for social improvement.’”
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OK, so Webster’s wasn’t referring to the letters that stand for the Utah Telecommunications Open Infrastructure Agency, which was formed 12 years ago as a way to give all homes in member cities access to a fiber optic cable system that was to bring them competitive choices for high-speed Internet, phone and television service. But the impracticality of the system has been just as evident from the start.
People didn’t exactly sign up for the service in droves, which is why member cities now are paying part of their tax revenues to cover its costs. At least some of the customers were charged $3,000 to hook up the cable to their homes, which could be broken into easy payments spread over 20 years, but which also came with a lien against their property.
Now UTOPIA has a suitor, an Australian investment firm called Macquarie Capital Group. It will take over the network and finally build it out as originally promised 12 years ago. The catch? Each member city is being asked to impose a payment of somewhere in the neighborhood of $15 to $20 on each household, regardless of whether those households want Internet service or even own a computer.
This would include the elderly gentleman I spoke to in West Valley City the other day who told me the last time he tried to turn on his computer it told him, “Abort! Abort!” He shut it off in a panic and hasn’t tried again.
Unfortunately in this case, Abort! is an option the cities can choose, but only if they want to keep pledging taxes to retire debt on something their residents no longer receive.
But then, as UTOPIA’s opponents, most notably the Utah Taxpayers Association, have noted time and again, if you don’t get out now, things will get only more complicated.
Meanwhile, while we’re in the dictionary, no one seems to know exactly how to define this $15 to $20 payment. Is it a fee? That would be “a charge or payment for a service.” Those folks who don’t want the Internet still have to pay, right?
Is it a tax? Then we’re back to the dictionary, or even the Utah code, trying to figure out what type of tax it is and where cities get the authority to levy it.
I hate to keep harping on this, as I have now since 2002, but this whole idea, noble though its intentions may have been, is built on a false premise. A fiber optic network is not the same as a public utility.
Think about real utilities, such as water, gas and electricity. They can be delivered to homes in one basic way. As Scott Cleland, former deputy director of international communications and information policy for president George W. Bush wrote in a recent blog, broadband services, “can be delivered electrically over many kinds of metal wires, optically over fiber optic cables, and wirelessly in a wide variety of ways.”
The fact that one group lays cable with the help of tax funds and calls it a utility doesn’t stop companies from competing successfully with that cable by providing the same service by other means.
Cleland said investors have spent $1.2 trillion nationwide over the last 10 years on broadband facilities and delivery systems. The attractive thing about this, of course, is that this was their own money, not taxpayers’ forced payments.
I don’t know how the 11 UTOPIA cities are going to vote on the Macquarie deal. It’s not easy to back out of something to which you’re so deeply indebted.
But they might want to think back a decade or more and ask themselves how practical this scheme for social improvement has proven itself to be.