Pete Ashdown Speech to Salt Lake City Council on UTOPIA - February 2004

In 1993 I founded XMission, Utah's first Internet Service Provider to the public. XMission has grown to support over 20,000 customers all over Utah and the world with 50 employees. One thing has not changed, and that is my commitment to Salt Lake City. XMission is a prominent sponsor of the Utah Arts Festival, the Living Traditions festival, and the Twilight Concert Series. Our support of non-profits is unequaled by any other service provider I know. We grant up to $50 a month in free service without bias to any state or federal registered 501C3 non-profit. I have remained downtown in spite of cheaper space outside the city, and most of all I have not sold the company in spite of numerous offers because I knew that although it might be good for me, it would be disasterous for my customers.

Because I was the first to walk the Internet path in this state, I have had extensive experience in dealing with Qwest and before them US West. I am here to tell you that relationship has been repeatedly strained by the lack of foresight by their management and their unwillingness to listen to their customers.

In late 1995, US West rolled out a new data phone line known as ISDN. Their submitted tariff to the public service commission was so prohibitively high, that nobody would buy it. In a subsequent meeting with US West representatives, they angrily told me that my customers shouldn't be using the Internet for extended hours because that is not what their telephone system was designed for. When I responded with, "I have news for you, Internet use will only increase and you had better be ready for it," They shouted at me that I didn't understand the technical limitations of the telephone system.

Four years after I started XMission, in 1997, US West started providing Internet service to the home. In 1998, I was happy to see them offering "always on, always connected" DSL. Apparently it was not I who had not understood the limitations of the phone system, but the executives of the resident monopoly who had not understood the potential of the Internet.

I have been under the thumb of this monopoly for too long to believe their promises of change. Let me remind you, it was the Telecom Act of 1995 that was supposed to remedy all of this. Indeed, I have been able to buy my business telephone services from an alternate provider in Salt Lake City. That has not been without its share of dirty tricks and feet dragging by Qwest. However, the choice for residential consumers is not as easily available. If I want telephone service over the same copper from an alternate phone company, I'd better be prepared to wait. If I want it from Qwest, I can get it in a single day.

Qwest has been kind enough to lease us their DSL system to provide Internet services to our customers. However, due to the fact that our customers may contact Qwest directly to order services, more often than not they aren't told that XMission or any other non-Qwest service is available. Customers repeatedly tell me that they regret having to leave XMission, but they need high speed Internet. When I inform them that they could have chosen XMission, they ask me why didn't Qwest let them know that? A good question with an obvious answer.

Comcast is also making great strides in the direction of high speed internet to the home. Yet they are keeping this for themselves in Utah. I understand that the Comcast president of Utah recently stated that he understood their network to be open to other providers who would pay their wholesale rate. I don't know where this guy is golfing in February, but he certainly isn't spending much time in the office.

The UTOPIA metropolitan fiber network presents the first tangible opportunity to change all that. Unlike many UTOPIA critics, I was hesitant to pass judgement on the project until I fully understood its business plan. After I met with the UTOPIA representatives for the first time in December, I became a staunch advocate. UTOPIA critics can not point to any specific problems in the plan. Rather they rely on broad strokes such as "waste of tax dollars", "nobody wants it", "boondoggle" and "horrible name."

The newspapers deem this project too risky because they say there is no way to know what the future holds for telecommunications. This is an uniformed view based on a lack of understanding of fiber optics. Any 3rd grader with a science bent can tell you there is nothing faster than the speed of light. Light is the ceiling upon which all our communications are based. Even computers are starting to take baby steps towards using light instead of electrons. What really comes into play with the use of optics instead of wires is the spectrum potential. Each color can send a different stream of information, and when you consider that each color is defined by the ability to determine wavelength, the potential of fiber becomes beyond our comprehension. Scientists point to a theoretical limit of 1.6 TERABITS per second on a single fiber. To put that number in perspective, this is roughly 20 times the current global internet and telecom traffic use, TO YOUR HOUSE. Newspaper editors don't think fiber has enough potential to last 20 years? Tell that to the companies laying undersea fiber.

When you compare this potential to DSL, cable, satellite and wireless, it becomes laughable. UTOPIA opponents who say fiber may be supplanted by some other technology are only displaying their ignorance and are not qualified to comment. Of course, an average citizen will not require this kind of speed now, but the potential of fiber is cemented.

Recent mention by the council state that the city should not be in the business of venture capitol. Now I have a pretty good understanding of venture capital, having turned it away over the past ten years. Venture capitalists are investors looking for high return, but aware of high risk. However, metropolitan fiber is not a mission to Mars. This concept has already been tested not only by other countries, but by the very communications companies here today. Its is frequently asked, if it is such a good deal why doesn't private enterprise undertake it? Because on a residential scale, the profits are miniscule in comparison to what can be made on a business scale. Why service grandma when you can cherry-pick downtown? As Qwest Utah President Jerry Fenn says, "Why give them a Mercedes when a Chevrolet will do?" I have a better anology given the potential of fiber, "Why give the public cheap, fast cars when they have feet to walk with?"

I think it speaks volumes that Jerry Fenn helped draft the original legislation that allowed the creation of UTOPIA. Now that it is actually becoming a reality, Mr. Fenn has a different taskmaster who with the help of the Utah legislature is trying to take that power of decision away from you, the city council.

I am puzzled at the relationship between the Utah Taxpayers Association and Qwest and Comcast. Are they telling us that it is OK for goverments to install monopolies and allow them to haul revenues by the tankerload out of our state? Is it fine to be a captive rate-payer to a service-poor monolith just as long as the "T" word isn't mentioned? Recently they savaged the iProvo project as being one step away from socialism or even communism. How deposing the recalcitrant government installed monopoly Qwest so competition can flourish qualifies as communism is beyond me. Qwest is so enamored with their antiquated network that the goverment bought them that they don't want to see the government step in to buy another one.

Momentum from other city councils is building behind UTOPIA. Five of the 18 cities have already approved it. What I fear most is that if Salt Lake City refuses to back this project, it will become a digital wasteland surrounded by cities with the foresight to move forward on municipal networks. These cities will not only become attractive for outside companies and households due to their superior network, but to residents and businesses already here. I do not want to see any more attrition away from the city I love.

Over the past ten years, I have never approached government for a handout to support my business. I have never shrugged my tax burden. I have supported downtown and given people good jobs. I have given back to the community and supported it in ways unheard of in my industry.

City involvement in the backing of UTOPIA is essential to guarantee its openness.

This business plan is solid.

The time is right.

Please join me in supporting the UTOPIA municipal fiber project.