EATel Expands— North, South, and “up”

EATel, The little locally-owned East Ascension Telecomms company that could, is having a good week. Their bid for an East Baton Rouge parish-wide franchise agreement that will move them into the large capital city market was approved last night. They announced the pending acquisition of Vision Communications, an adjacent Lafourche Parish telecommunications company, whose customer base will increase their size by more than a third. And, wait for it: they announced that their first 4G cell towers became operational this week.

Whew…

Now, on to the inevitable caveats:

1) Re: The EBR franchise. While this is an undeniably good thing for Baton Rouge generally (EATel is building a FTTH network that gets rave reviews) it isn’t at all clear that it will be widely available. According to the Advocate story the firm fought suggestions that it should be required to adhere to the sort of build-out requirements that Cox (but not AT&T) was required sign. Generally build-out requirements mean that the company would be required to serve everyone—not just the most profitable (read wealthy) customers. The only reason that EATel and other telecomm companies have to bother with franchises is that they want to use the public’s resources—the rights of way along roads that the community owns and maintains. The council’s failure to insist on some, eventual, conditioned, form of universal access means that it is unlikely that the full benefits of fiber-based competition will  reach the poorer and/or rural parts of the parish.

2) Re: The expansion down Bayou Lafourche. EATel won’t be building an new network in this area. According to the Daily Comet:

While Eatel has no immediate plans to convert Vision’s network to faster fiber optic, Russell says Vision customers can expect “an upgrade of the network to improve current services.” Those details are not solidified, but Russell said adding high-definition channels and improving Internet speeds are among the possible improvements.

 No fiber. That’s sad. On the other hand the local family-owned company is bound to provide better service and more timely upgrades than the current “venture fund” owners could be bothered with. Note: The Advocate also has a nice story with some additional details.

3) Re: The ongoing upgrade to 4G LTE  in their footprint. No caveats needed. This is an unabashedly good thing—especially as AT&T is notably late to the 4G LTE party. (What AT&T is passing off as 4G is not, by most accounts, the real deal…their HSPA+ version lacks much of what is supposed to come with a real shift to the next generation of wireless—not that AT&T isn’t going to move to LTE…just not quite yet.

LUS Fiber Financials Covered in Local Media (and more)

I posted earlier about the LUS Fiber budget hearing yesterday. There I focused on the annoying return of the idea that LUS was (somehow) being subsidized — I suspected that Patin had successfully revived a truly dumb idea. Credit where credit is due: Neither the Advertiser nor the Advocate‘s reporters chose to take the bait and emphasize that foolishness. Instead they largely reported on the issues raised by the Councillors and Tim Supple. Take a look at both articles, they are worth the read though, frankly, the Advocate is better on the technicals possibly because Burgess was here during the fiber fight and has a deeper background.

Executive Summary: LUS’ financials are confusing. Financials just are confusing. Always. But LUS Fiber, being a semi-autonomous arm of the semi-autonomous LUS utilities (which is owned by the city but semi-run by the city-parish) is especially confusing. This is exacerbated by a sick state law designed to raise the prices that customers pay that causes LUS Fiber to give money to LUS utilities so that LUS utilities can loan it back to LUS Fiber—at interest. (Which means there is a subsidy: of LUS utilities; not the other way around.) Got it? Confused yet? Anyway:

The Important Stuff: LUS Fiber is doing ok, not great but ok. The “ok” part can be seen by its more than doubling its installed base in the last year; recent statements by Huval confirm that the utility has made over the bump and has the minimum number of users to break even. The “not great” part is due to the fact that it’s not meeting the rosy projections of a 2004 feasibility report that had predicted that LUS would be doing better than just ok, that they would be doing great by this point in the rollout. (The feasibility study was always sketchy and clearly a political document. See my first two blog posts on this issue. #1, #2)

Extras from my Notes: Caution: This is for the dedicated few who’d like a little more on the two and and a half hour session than a dry newspaper article has space for or fits the newspapers’ idea of a budget meeting story.

Attendance: Theriot, Patin, Boudreaux (presiding) Shelvin (late), Castille,  Morrison Conspicuous by his absence: Don Bertrand who was a leader in the fight for fiber and certainly has a better understanding of all matters concerning LUS Fiber than any of fellow councilmen.  His participation would have really helped the rest of the council make sense of the arcane parts of the presentation—some of the questions asked showed a real lack of understanding.

Overall: Part of the confusion that reigned during the presentations was due to a new computer financials program and a new, much more extensive report format that was presented to the council. It was apparent that some had only read (at most) the summary sections and it showed in their questions. LUS Fiber is a big, new, different, retail establishment for the C-P to keep track of and understand and Toups seemed to feel that she was only just getting hold of it all.

Conservative Borrowing: A couple of times during the presentations it was apparent that part of the reason that LUS’ numbers were tight was because LUS was being…tight. One example came up when Shelvin asked whether it would all look better right now if LUS had taken the whole 125 million authorized by the voters instead of only bonding out 110 million dollars. Huval hemmed, hawed, and said that they just didn’t want to borrow more than they really needed. This was in the context of LUS having not yet taken the in-organization loan of 5.5 million that the council authorized. A lot of the noise we are hearing now is a direct consequence of LUS Fiber deciding to make do with the very least borrowing they can get by with.

Competition: LUS estimates that the citizens of the community have saved 5.7 million dollars—in part direct saving from LUS’ cheaper phone, video, and internet services and in part as a consequence of Cox lowering its prices and giving out special rates. Those special rates were discussed in the meeting with Huval pointing out that Cox had petitioned for and received permission to treat Lafayette as a “competitive” area. That meant that Cox could offer special deals to Lafayette users and, as we all know, has offered cuts to anyone who tries to leave. Those “deals.” as Huval pointed out to Patin don’t include the rural areas of the parish where Cox has no competition.

Coalitions: Intriguingly coalitions with other communities that have fiber were mentioned and Terry indicated that this was involved positive attention from the White House. I’m pretty sure that this is the US Ignite project—a project initiated by the administration that will bring together communities that have next-generation fiber projects. Conceivably this could be a “big thing” and bring ideas, financing, and lend emphasis to the movement to develop big bandwidth applications that could be used across these communities. Lafayette’s own FiberCorp has been a player in this effort.

Why no Google Fiber for Baton Rouge? (Updated)

The folks in Baton Rouge are probably asking themselves why they didn’t get Google’s gigabit fiber network. After all for a while the Facebook page “Bring Google Fiber to Baton Rouge” had more fans than any in the country and there seemed a pretty large groundswell of support. There was a heavily rewritten AP article in the Advocate that interviewed a BR Chamber officer and recounted the history of local public involvement. (Unfortunately not online check p. B-6 of 3/31/11 paper.) It all seemed so hopeful. The Chamber held out hope that Baton Rouge might get in on the second round.

I don’t think so. At least not until we put our own house in order.

Here’s at least one reason that Google avoided Louisiana:

See Kansas? It’s Green. Texas and Arkansas are Red. Louisiana is a sickly Orange. Google is only going to green states. This map has nothing to do with solar energy or recycling. The green denotes a place where there are no state-wide legal barriers to a community building and owning its own fiber-optic network. Red states absolutely forbid it. Louisiana is among those who are hostile but do not completely outlaw the idea. (Witness Lafayette’s ongoing battle.)

Google wants to strike out and do something truly different. They are frank about thinking the Cox’s and AT&T’s of this nation haven’t done a good job and that local communities can do better and should be helped to do so. Google has no reason in the world to go to a state that tries to make the sort of community involvement they count on illegal.

They aren’t coming to Louisiana until the “(un)fair competition act” is abolished. If Baton Rouge (or New Orleans, or Shreveport or Bossier, or any of the other Louisiana cities that applied) want to have a shot at Google’s second round the first thing they have to do is get their own house in order.

Repeal Louisiana’s (un)fair competition act…

(Check out the great map at muninetworks.com from which I grabbed the above illustration. It chock full of valuable, if depressing, information.)

Update 4/1/11: Stacy Higginbotham, tech journalist extraordinaire over at GigaOm, covers the Texas version of this story. Apparently Austin had a very credible, widely supported effort to get their city picked. The local organizer thinks:

“Austin caught their eye for all the right reasons, and we had support at the highest levels with the involvement of the mayor and the city manager, but given the Texas limitations on municipalities getting involved in network, there was only so far we could go,” Rosenthal said. “So I look at the Texas Legislature, because they really put us in a box with regard to Google, and every response the city gave had to be measured within that box.”

Yup, I expect he’s exactly right. Texas forbids muni networks. Google is doing this to encourage muni networks. The are NOT going to pick a city in a state with lousy laws that forbid what they are trying to get other municipalities to do. That’s only common sense.

Update 4/4/11: Take a look at what the paper in Kansas City, Kansas thinks were the reasons that its city made the cut. The story, understandably, tends to focus on drama and secrecy but there are some very interesting nuggets in there about the underlying factors that might have favored KCK once the first cuts were made.

Update 4/4/11, 8:15 PM: As part of the ongoing discussion in the comments I reviewed the Louisiana law constraining muni networks. There I found what I thought I remembered: The law explicitly includes the sort of public-private partnership that Google is undertaking in Kansas City. So anyone who is murmuring that Google could do a project similar to the KCK one in Louisiana simply has not read the law. You can bet that Google has. See the element of the law which defines a public-private partnership as one that must adhere to all aspects of the law at RS 45:844.47 B(3): “Through a partnership or joint venture.” If Baton Rouge wants Google to consider them in the second round they’ll want to repeal this law first.

Pat Ottinger, City Attorney, Steps down

Pat Ottinger, the city attorney through the entire (successful!) fiber fight is stepping down. The media are all carrying the story; you can look at fleshed out versions from The Independent, The Advertiser, and The Advocate.

Ottinger is the unsung hero of the fiber fight. He worked long hours and fought tirelessly to make sure that Lafayette got the chance to make its own future in spite of well-funded corporate lawyers, Cox, BellSouth and their stooges in the state legislature. His work was instrumental in defending what we had won after the referendum battle. Lawyers don’t get much glory; that’s not the sort of profession you go into if glory and adulation are what makes you run. We’ll surely get a more complete run-down on his accomplishments in the coming weeks as editors put together their stories and in that larger history the legal battles that swirled around Lafayette’s decision to build its own future will be far from the only story. But that is the one I’ve watched closely and I can say without reservation that Lafayette was well-served.

The city has lost a real public servant, one whose earnestness and self-evident competence should serve as a standing rebuke to those who’d disparage those among us who choose to serve.

Lagniappe: I spent a few minutes looking through old LPF stories…the first one to mention Ottinger by name is worth your review as an example of the value of having an Ottinger on your side: The City replies to the BellSouth lawsuit

LUS: Who Governs?

The question of who governs LUS—and apropos this blog, LUS Fiber—was raised last night at the meeting of the Lafayette charter commission. Terry Huval, LUS director, suggested that he favors some sort of governing board. This drew sharp questions from the commission and featured articles from both the Advocate and the Advertiser. The Independent blog weighed in early alerting readers to the meeting and offering useful background information. But AOC, as part of its desire to inform the public, has uploaded the full meeting to the web and I’ve embedded it here:

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The stories, understandably, focus on the sure-to-be-contentious issue of governance. It’s a source of conflict because LUS’ governance is the point which most clearly illustrates the reasoning of those who are pushing for deconsolidation, for giving Lafayette back its own city government. LUS was owned by, and arguably was the most valuable asset of the city of Lafayette back in the days before consolidation. The clear intent of the new consolidated city-parish charter was to keep control of LUS in the hands of the city. In pursuit of that goal LUS was to be governed by the LPUA—a panel made up of all the members of the city-parish council whose district contained at least 60% city residents. Almost immediately, however, legal opinions were sought and contradictions were found between those sections that gave control of LUS to the LPUA and those that gave control of “all” functions to the full council. A subtext here is the general tenor of the time immediately after consolidation— a “we can all get along” feeling was apparently widespread and when bond attorney’s voiced a feeling that bond issues would be look stronger if both the LPUA and the full C-P Council approved them that principle was quickly generalized to all governance matters. With a few tweaks to the implementation details that has been how LUS has been governed since.

This all blew up recently when LUS asked for the first electric rate hike in more than a decade. Arguably (and I do so argue) the ensuing deconsolidation conflict grew from the fact that ideologically conservative Bellard and Theriot, rural members of the council with few city citizens in their districts, refused to honor the majority decision of the LPUA to grant the hike. That resulted in a squeaker vote and served notice that the traditional ways of working around the deficiencies of the charter could no longer be relied on. People began looking for ways to “fix” the problem by fixing the charter. But once that Pandora’s box was opened the issue quickly morphed into one focusing on sovereignty for the City of Lafayette—a new city-only council, a real mayor for the city, and total city control of city assets. LUS has become a secondary issue for most of those passionate about issue but it remains the biggest practical problem, and among those whose bent is practical and pragmatic a solution to the problem of LUS governance would go a long way toward ending their worries.

(Unintended consequences alert: Bellard and Theriot are the councilmen most passionately opposed to deconsolidation. It’s a practical not principled position. The new ideological conservatives are supposed to be all for smaller government and moving power closer to the people as a matter of principle—and deconsolidation would do both. But Bellard and Theriot have the practical problem that their largely rural constituencies would be the ones left without resources in a new, rump, parish government. So, principle aside, they are against it. If they’d been old-fashioned conservatives earlier and honored the tradition of allowing the LPUA to decide on matters relating to the city utility they’d not be in this position today.)

What was interesting in Huval’s presentation lay as much in what he did not suggest as what he did.

What was suggested (@ 1:16 minutes in the above video) was drawn from data offered by the American Public Power Association (a body of which Mr. Huval is a past president):

  1. 44% are run by an appointed Board
  2. 28% are run by an elected Board
  3. 28% are controlled by the Council or local equivalent

The Commision had asked Mr. Huval to suggest a range of alternatives and this is what he offered in response. Huval clearly did not want to wade in any deeper though he seemed, in several remarks, to favor some form of a board. For instance, he remarked that he’d recommend, and repeated this recommendation several times, that a condition of membership on the board be residence in the city of Lafayette. At another moment he was also clearly concerned that it was at least possible for a council to be made up representatives who, even if their districts were mostly in the city, were not themselves city residents.

What was not suggested was any of a range of alternatives that had been batted about and which were mentioned in passing by Commission members. Specifically: proportional voting. In such a scheme all members of the council who had any city citizens in their district would get a proportional vote on the LPUA/Council on matters relating to LUS. So, in one example, if Representative A had a 20% city constituency then he’d get 20% of a vote and Representative B, whose district was 80% city would get a vote that was 4 times as large as A’s. Bruce Conque, a commission member who’d floated such a suggestion, was not present at this meeting.

Also not suggested were ways of dealing with the issue by simply changing the charter to take away any ambiguity as to the governance of LUS. It should be a relatively simple matter to make LPUA control explicit. Why that should not be explored more specifically is a matter for speculation. How much of the bond-worthiness of the city and the parish is due to having the large and stable income of four utilities to stabilize its income?

Nor was there any discussion of separating the traditional utilities—which operate as a municipal monopoly and the LUS Fiber division which operates in a much more competitive environment and under a vastly different set of constraints. State law already separates LUS Fiber from the rest of LUS for many purposes (part of the infamous (un)fair competition act) and discussion of the value of a separate LUS Fiber board would seem in order—even if it were finally decided that was not the way to go.

A lot of the questions asked by the Commissioners centered or touched on the role of LUS in encouraging or discouraging annexation of developing areas into the city. Mostly this centered around water (which is now being sold to surrounding areas at a rate that is higher than the retail rate in the city!) LUS Fiber, which is too young to have an historical role to play in that story was largely unmentioned. But it should be clear that LUS Fiber adds significantly to what the city of Lafayette can offer unincorporated areas. What isn’t being discussed is how LUS’ tight ties to the city have limited the growth of the utilities themselves. To the extent that the people of the community own their own utilities they keep local money at home and can use the resources to best serve the people of the community rather than the best interests of out-of-town investors. LUS has traditionally been seen as a huge benefit to the town and then city of Lafayette and it is often cited as a partial explanation for the way Lafayette moved past larger, but less progressive cities to become the hub city of the region. Is there any way to extend those benefits to others in the region without being unfair to the people of the city of Lafayette? I’d hate to see the value of public ownership stifled by peculiar historical arrangements. Of all the suggestions so far put forward the most easily adaptable to allowing the utilities to benefit the people outside the city limits would seem to be proportional voting. It’d make sense to separate LUS Fiber and the other utilities so that they could advance at differing rates. (It is my understanding that bond covenants which entangle all of the traditional utilities would likely make it impossible to separate out the water service from the electric. I’d be happy to stand corrected.)

Interestingly, the current dustup isn’t the first time the issue of LUS governance has been raised locally. The local League of Women Voters (full disclosure: I’m an active member) recommended an oversight board as the “final recommendation” in their extensive study of LUS Fiber’s potential for the community. Interestingly Terry Huval was at that time adamantly opposed to the idea, attending a public meeting SLCC called to discuss the issues raised by the report chiefly to make the point that such a board for LUS Fiber was not a good idea. It isn’t clear what has changed between then and now…beyond the uncomfortable realization during the rate hike discussion that LUS could no longer count on the city-parish council to honor what city councilors thought best for the utility.

“Cox gives laptops to eighth-graders”

Kudos to Cox. This morning’s Advocate reports on Cox’s latest effort to address the digital divide and offers a brief overview of continuing efforts in Lafayette to address the issue.

The company announced Thursday that it will donate 350 Dell netbooks to select eighth-graders who have no access to the Internet at home. The donation also includes free home Internet service for a year.

This isn’t Cox’s first donation—they did something very similar back in ’08 supporting The Early College Academy. This time through:

[Cox] will donate 350 Dell netbooks to select eighth-graders who have no access to the Internet at home. The donation also includes free home Internet service for a year…

The 350 students will be identified through the district’s GEAR UP program, an early college-awareness program that targets middle-school students.

This initiative resembles a suggestion made late last year by the cable industry. At that point the NCTA—the industry’s support and promotion arm, suggested that a good way to use some of the broadband stimulus money was to support its “A Plus” program; that program was broader but less generous with Cable’s resources. It suggested that:

(1) digital media literacy training; (2) discounted computers that can access the Internet; and (3) discounted home broadband service to households that do not currently receive a broadband service.

Cox is also renewing support for the Boys and Girls Club, this time donating an expansion of their computer lab to the Jackie Club.

These generous donations join other Lafayette-based efforts to ensure equity in accessing the internet. In ’09 Je’Nelle Chagois’ Heritage School put 200 computers into the hands of students at Faulk Elementary. The Heritage School is also a participant in a $5.3 million stimulus grant request with LUS that has a similar, student-based purpose.—A second grant for $3.5 million has LUS and LCG partnering to build and enhance community computer centers that serve a broad range of citizens.

It’s all good stuff. Kudos to Cox on this one.

UPDATE 7/13/10: The Advertiser logs in with a substantially similar story this morning, except theirs doesn’t discuss other Lafayette efforts to bridge the divide…

Revised LUS Fiber Budget

Both the Advertiser and the Advocate have articles today on last night’s council meeting and LUS’ revised budget. The big news was that LUS will not meet its own revenue projections; in fact they are off by about half…a disturbing shortfall.

Huval’s explanation cites two factors: the lack of initial marketing and defensive budgeting that was designed to make sure that a worse case scenario of having too many customers wouldn’t “break” the budget.

Defensive Budgeting
This is one of those cases where the Advertiser has the better quote:

“We made projections based on the most optimistic approach,” LUS Director Terry Huval said. “We didn’t want to get into a situation where we might have budgeted too conservatively and we don’t have the materials and supplies for the customers.”

To understand what Huval is worrying about requires some background. LUS is in the odd position of having a brand new service that needs to be cautious about growing too fast. Hooking up and initially provisioning each household is a VERY large expense. The labor and materials costs — especially the set of three boxes that sit on the side of the house and the set top box inside the house—are all very costly. It will, in many cases, take several years to recover that initial investment. While the profit margin is good, even with LUS’ reduced prices, you have to invest substantially in each customer. On the books you will typically lose money for a time on every new customer you bring on. As a consequence you might have to look at borrowing more money. For most businesses this would not be something to worry about very much. Any bank could see that you were a better risk for capturing a larger share of your market than you initially anticipated. You’d get your “float” loan.

But LUS is not like other businesses. LUS cannot, practically, go back and get a bridging loan. They have borrowed all their money upfront in the form of bonded indebtedness. Budgeting in this situation is, in part, a way of projecting the “draw” the business will be making against that loan. What Huval is saying is that they originally projected the most “optimistic” draw against the loan so that they would be sure that they had enough money at the ready to buy the equipment they needed to complete the budgetary period without going back to well…So budgeting for the most extreme case was, in this case, “conservative” budgeting. A typical business would typically borrow for its most optimistic realistic case in order to have a little reserve and to avoid having to go back and borrow money again—usually at higher rates. This maneuver is LUS’ equivalent.

The tendency to be conservative here is aggravated by a state law that shapes the way LUS has to assess the risks to its business. And we have Cox and AT&T to that for that: Long-time readers will recall my inveighing against the (un)Fair Competition Act. This is one of the places where that incumbent-written law comes into play. One of the provisions of that law is that LUS is forbidden to loose money for any year. If they do, the law mandates a fire sale of the business. Given that law, you’ll notice that once you understand that LUS is actually investing in each customer that it is entirely possible to be successful too quickly. Suppose LUS took 50% of the market in a single four month period…and then, having saturated the local market it would have to endure a year or two or three of losing money just to pay off that initial investment before the income from the bulge of new customers turned positive. It is far safer to grow at a steady rate as long as you get above the break-even point before the bond money runs out. Losing money too fast is always a problem. But the (un)Fair Act makes being successful too fast a problem too. State lawmakers piously claim that they are just protecting the citizens of Lafayette from losing money. This case makes it obvious that the people that wrote the bill, AT&T and Cox, are the ones being protected. Lafayette doesn’t need or want Baton Rouge’s protection.

Marketing
LUS also acknowledges that it hasn’t run much of a marketing campaign, saying that it doesn’t make sense to gear up a large and expensive campaign if you aren’t yet ready to sell your product to all the people you’re paying to reach. From the Advocate:

Revenues for LUS Fiber this year might have been more in line with the initial projections had the city pushed a more-aggressive marketing campaign, Huval said.

But he said the decision was made to hold back on intensive marketing of the service until it was available to most residents, so as to get the most out of the marketing dollars.

That does make a certain amount of sense. But that excuse is already effectively over—LUS is currently finishing off its build-out. The vast majority of the citizenry is now ready to receive service. So we should now begin to see a much more aggressive campaign. —Though, of course, not sooo aggressive as to run afoul of the (un)Fair Act’s penalty on gaining customer share too quickly. (sigh)

In all fairness, LUS also has another reason not to want to sell too much of its cable product too soon. also been wrestling with the set top box software—the initial software was simply not up to snuff…it provided the fundamental functions in that it would change channels and record material but the interface was outdated and it was clumsily designed. It was even worse than most cable providers interface and that is saying something. With the new Microsoft Mediaroom LUS has come out on the other side–the interface is very slick, it works well and there are obvious hooks left for the development of innovative features. But until that mess was settled and LUS knew that Alcatel was going to step up and make good on its promises LUS Fiber was looking at a situation in which it very strongly suspected that each and every video customer was going to upgraded to a new box and software platform in the very near future. They had little desire to put the whole city on a solution that they would have to turn around and dump.

Take-Rates
The most reassuring part of the story is that the Advocate reports that Huval is saying that they are making their break-even rate—that is, they are getting the 23% of the population they need to win over to break-even and pay back the dedicated bonds. That, frankly, is the only important number—

[Huval] said that even though LUS Fiber is not meeting the early revenue projections, he feels confident the venture is building a solid foundation and will be successful.

LUS Fiber can break even with a 23 percent market penetration, Huval said, and that percentage has been “handily” reached in most areas where the service has been available for more than a few months.

What’s interesting is that while LUS will doubtless get some flack for not meeting its defensive budget estimates nobody is asking what LUS achieving its break-even rate means for the other actors in this little drama: Cox and ATT. Leaving aside ATT for the moment since it is not selling a cable product let’s look at Cox. Nationally the take-rate for cable video is supposed to be about 50%. I don’t have any reason to think Lafayette would be much different. If LUS is taking more than 23% of the local market “after a few months” that would imply that in just a few months—without a very credible set top box arrangement and with very little marketing—LUS can take about half of Cox’s well-established cable video market. That makes LUS, by any reasonable assessment, a very successful competitor.

Lafayette, the NCTC, and National Policy

Both the Advocate and the Advertiser have posted stories focusing on the latest move in the Cox/NCTC versus LUS/LCG contest being gamed out in the courts. In this turn Lafayette is has filed suit to dismiss a lawsuit filed in in Kansas by the National Cable Television Cooperative (NCTC). That lawsuit was filed in an attempt to block LUS from pursuing a complaint with the FCC.

So…this is a suit to block a suit which hopes to block a filing at the FCC…there’s a legal logic in there somewhere I am sure. Or in the words of the Advocate:

Attorneys for Lafayette argued in court filings that the cooperative’s lawsuit is an attempt “to drag a Louisiana municipal public utility into court on the plaintiff’s home turf in an effort to avoid being held accountable for its conduct before the Federal Communications Commission.”

The Advertiser:

The FCC complaint by LUS Fiber argued that NCTCS engaged “in unfair, deceptive and anticompetitive conduct that has the purpose of effect of preventing LUS from becoming a member of NCTC and thereby obtaining the huge quantity discounts and other that NCTC negotiates for its members…” “We have stated in our pleadings filed today that the court should dismiss NCTC’s complaint in deference to the jurisdiction of the Federal Communications Commission, or alternatively suspend any further proceedings until the FCC has decided the case initiated by the Lafayette complaint,” city-parish attorney Pat Ottinger said.

The story closes, appropriately, with the note:

NCTC’s largest member is Cox Communications, LUS Fiber’s primary competition.

That Cox is engaging in anti-competitive behavior through its influence at the NCTC is the core of Lafayette’s public relations case; and, given Cox’s behavior here in Lafayette, it seems entirely likely. The fact that the other two cities that had initially joined Lafayette in its complaint, but were after filing suit admitted to the membership process, did not have the NCTC’s largest member as competition is damning. That these cities’ corporate competitors do not belong to the NCTC tends to clinch the argument.

In fact, that those other cities had competition that does not belong to the NCTC is a strong argument that more is at stake nationally than simply the interest of a mid-size, aggressive city somewhere along Louisiana’s cost and its huge corporate competitor. As I’ve pointed out previously, other members of the NCTC have engaged in the sort of anti-competitive blocking that Cox has used in Louisiana.

The NCTC used to be a mechanism for small, locally-owned cable networks and municipalities to get relatively fair programming prices for their customers. Over the years the market has changed and single-system mom and pop operations have all but disappeared as large and medium size “mulitple system operators” (MSOs) cable companies have grown by leveraged buyouts of smaller competitors—not by successful competition with other cable companies. Successful head-to-head competition requires building a better network and providing better services. (The route, incidentally, that Lafayette has chosen.) Buyouts only require taking on large debt burdens…burdens in fact so large that they can make finding the money to make major service upgrades very difficult.

Now the NCTC is run by debt-heavy MSOs, not mom and pop, local, cable companies. Cox is merely the biggest. Many other NCTC members are no doubt in the same structural position as Cox cable—heavily in debt—and many of those are in the smaller locales that may be actually losing population. These smaller municipalities could reasonably feel that they’ve lost the local businesses to which they felt loyalty to faceless corporations who do even fewer network upgrades than the small local businesses did. Those small cities and towns are the ones that, nationally, are most likely to consider investment in a fiber network an investment in their future.

The NCTC has a legitimate national function…lowering cable prices for the customers of small cable companies and thereby allowing local alternatives to enormous international telecommunications corporations to exist. The outcome of the current conflict over Lafayette’s membership will be a decision-point for the nation. Either the NCTC will provide that service for all small operators or it will turn itself into an exclusive cartel that uses its purchasing power to push out all competition.

That is a national problem; it is not simply a small side fight down in some damp part of Louisiana.

Correction: It’s been pointed out that Lafayette has not really filed suit in response to the suit. They’ve merely responded to the NCTC’s Kansas suit. Point taken. That is actually clear in the press release. I let a fun line get in the way of a close reading…mea culpa.

“Bridging a digital divide”

Richard Burgess has a piece up in today’s Advocate that offers an excellent overview of Lafayette’s digital divide efforts. I’ll review the highlights and offer some comment here but you’d be well-served to go to the source.

The story lists the most active digital divide efforts in the city, including efforts associated with the Heritage School program & KJCB, the Housing Authority of Lafayette, Vision Community Services lab, and the Lafayette Library.

Je’Nelle Chargois and the Heritage school:

A program that Chargois coordinates called the Heritage School of the Arts and Technology began providing computers and training last year to students at J.W. Faulk Elementary.

The students are selected by school staff based on need and given donated computers on condition they and their parents attend computer literacy workshops.

That program is the primary recipient of one of the two digital divide grants from recent stimulus funds applied for by LUS and LCG. If won the grant would provide 3.9 million for the expansion of the program, training, and free internet for the pupils’ households.

Walter Guillory and the Housing Authority:

Chargois is already working with the Housing Authority of Lafayette to provide computers for three planned computer labs at public housing developments.

Housing Authority Director Walter Guillory said the first lab is planned for the Simcoe Street Development in a retrofitted apartment that will be filled with 20 computers with access to LUS Fiber.

He said the lab, which is set to open as soon as it can be stocked with donated computers, will be staffed and also available to residents in the surrounding community outside of the development.

This program is actually a recreation of a lab setup first developed during the runup to the fiber referendum in 05. At that time and for a couple of years afterward it was staffed by Americorp volunteers. When that organization developed other programs and withdrew support the centers languished and were closed. Staffing and maintenance will be an ongoing issue. The provision of reliable human support is by far the biggest barrier to many programs.

Sessil Trepagnier and the Vision Community Services lab:

Trepagnier said the lab is open on weekday afternoons and offers computer access and training on how to use and build computers.

“We focus on technology, but we also teach them leadership skills,” he said.

Trepagnier’s center is a one-man labor of love. That’s both its strength and the model’s weakness. Lafayette, as blessed as it has been with people willing to sacrifice to see the right thing happen, cannot count on there being enough such people to fill the need—especially when they essentially labor alone. Folks like Sessile need a strong support system.

Sona Dombourian and the Lafayette Parish Library:

The library system has about 160 computers at its 10 locations in Lafayette Parish, and computer use has more than doubled in the past five years, with the number of computer sessions rising to 411,000 in the fiscal year that ended in October 2009, said library director Sona Dombourian.

The library system also offers wireless Internet access for patrons who bring laptops.

The library system is doubtless the largest single digital divide resource in the parish. In addition to computers and free net access it offers classes in a wide range of programs and activities, serving all age groups. I’ve set in on two discussions with library staff recently and came away impressed with both the personnel and the activities they sponsor. The library has the advantage of being a stand-alone institution with a dedicated tax stream to support activities its leadership understand are in its area of responsibility. Lafayette is lucky to have professional librarians and support staff that see the need and go the extra mile. The second stimulus grant that Lafayette has applied for will be spearheaded by the library but funds will also support centers at the Housing Authority and senior centers.

There are, of course, other good projects in town ranging from the Boys and Girls club to senior centers.

But for all of these the issue is, as I tried to say the phrases the article quotes, that more and more the barrier to full participation in the web is being reduced to the irreducible human and cultural factors.

LUS Fiber rates are low and the price of computers keeps falling, meaning that financial constraints, though they exist, will become less of an issue in years to come, said St. Julien, who also runs www.lafayetteprofiber.com, a website that tracks issues related to LUS Fiber.

“I think the initial thought was that hardware was going to be a big barrier. Now that the day is here, that is not a big issue,” he said. “We have reduced everything, except the human part, to a minimum.”

My first computer cost more than my first car. Less than a decade ago I spent money on a second telephone line here in Lafayette in order to get somewhat affordable always-on access to the internet at my North Lafayette home. I paid a small fortune to maintain a stable of professional-level software. I now do a fair amount of my net work on my carrier-subsidized “palm top” computer and get 50 megs of symmetrical bandwidth to drive my in-house wireless network of computers and devices. Many of these are products I would not have anticipated at prices I would not have believed. Excellent open source on net-based software can be had for free. Times have indeed changed. The costly computer has become a commodity, a present from a vigorous marketplace. The network connection is world class and amazingly inexpensive, a present of a vigorous community. Software can be had for free, a present of ad support and the open software movement. The barriers that once appeared to be insurmountable mountains have become, if not molehills, at least readily surmountable hills that the motivated can be helped to climb. The final barriers are people—people to support computer and center maintenance; people to man help lines and support the inexpensive or free open source software; people to educate. People to help.

That’s the real challenge before the Lafayette community: finding a way to rally people who care in support of the effort to bring the entire community into the digital era on an equal footing. I’m convinced the ingredients are there: the talent and the desire to help is clearly there. What is lacking is, generally, a mechanism that will enable folks to use their talents and realize their desires to help.

Ideas? Lafayette Commons (which provides nonprofits with support for its education edition of Google Apps) could use folks in support—and would be willing to sponsor a mechanism for the support of a broader set of open source software if the human resources could be found. A clearing house for setting up people with powerful free software? A once-a-month computer rebuilding “fest” where the techisly inclined could test and install software on recycled computers? We need the social mechanisms to make this happen.

I’d be happy to hear of any mechanisms or projects that you think would help, in the comments or offline.

“Carencro High pioneers in fiber optic education”

Marsha Sills of the Advocate has an analysis piece up today that coversthe Fiber Kids program at Carencro High’s Academy of Information Technology (AOIT). The lead:

Technology has changed the way classrooms look, how educators teach and how students learn. And one group of students, at Carencro High, is shaping the next generation of changes in the classroom, using fiber-optic technology.

Fiber Kids explores the use of fiber-optic tech in the classroom. The group has engaged in live streaming and video conferencing with kids in San Francisco and regularly uses a link to LITE’s video and 3d rendering engine. Community tech types regularly come into the classroom to offer their expertise on the arcane topics that knit together an understanding of modern big broadband technologies. The project knits together resources from Louisiana Public Broadcasting, the Lafayette Utilities System (LUS), Bay Area Video Coalition and Louisiana Immersive Technologies Enterprise (LITE).

AOIT has rapidly become a fixture on the Lafayette tech scene and most folks associated with technology have a (vague) sense of what the school within a school is about. But exactly because we “know” it, we tend to treat as something that is normal, a regular part of a decent city—in the realm of “oh sure, that’s a good thing.” As has been said: “A prophet is not without honour, save in his own country, and in his own house.” Others better appreciate what director Kit Becnel’s school has achieved as is evidenced by:

Becnel and the FiberKids project are known in the broadband community, council member Don Bertrand said at the (LCG-School Board) meeting.

Bertrand, City-Parish President Joey Durel and other city officials were invited to a broadband public interest workshop at Google’s Washington, D.C., offices.

“We did not have to tell them who you were,” Bertrand said to Becnel. “She’s setting the course in the entire country on the use of broadband in education.”

During the meeting, School Superintendent Burnell Lemoine noted: “Why us? Why Carencro High School?

“The response was: We were the only academy set up or in the position in the United States to do this kind of project…”

…connections set Lafayette apart from other communities, said Joaquin Alvardo, senior vice president of diversity and innovation for the Corporation for Public Broadcasting, on a visit to Lafayette last fall.

The closing paragraph, quoting Kit Becnel:

“I think not only nationwide, but globally, all eyes are on Lafayette and the capabilities: fiber to the home, education, public media, online, on the air,” she said. “This is going to be huge … as far as education and education redesign goes.”

It’d be a good thing to recognize the prophets that labor among us for little credit and less pay…(the “profits” get plenty of credit as is…)

A salute to Kit Becnel and AOIT!

post scriptum: If you’d like a bit more on the award mentioned here LPF is at your service