Tuesday, May 21, 2013

Celebration...and Post-Celebration Intranet and Wireless

LUS Fiber supporters had a good day today. The city's telecomm utility marked another signpost victory and, more crucially, began looking beyond the viability of the new utility and toward the benefits it can begin to provide as a successful operation.

Celebration & subscriber numbers:
Veterans of the Fiber Fight
Veterans of the Fiber Fight
The day started off with a gathering of employees, long-time supporters, politicians, and reporters in the atrium at city hall. Folks who'd worked hard during the fiber referendum in '05 held a mini reunion after  a period of circulation, talk, and anticipation. The chair of both the council and the LPUA (LUS' governing authority) gave brief talks but Huval, as directory, held center stage as he laid out the case for  considering LUS Fiber successful, promised new services, and urged the crowd to encourage residents who intended to sign up to go ahead and do so.

And, finally, he revealed subscription numbers, saying that LUS had 14,000 subscribers out of a possible total of about 43,250—based on water customers. That's right at a third of the available households and businesses.

Signposts:
At both the press conference and the subsequent presentation to the City-Parish Council Huval emphasized the encouraging numbers that emerged from the recent audit of City-Parish finances.
income rises, expenses level off, cash flow is positive
Three factors interact: 1) That significant market share—33% spreads the cost among enough people that the services can be offered at a cost-competitive price. In two years the customer base expanded 293% 2) Costs are leveling off; the large startup costs are settling back into maintenance mode. Costs only rose 6.5% last year. 3) Revenue increased by 41% reflecting increased numbers of subscribers served at a much smaller per household incremental cost. The result: cash is flowing into the new business at an increasing rate. This was always the predicted pattern but everyone surely breathed easier when the expected numbers showed up.

Looking Forward; the Benefits of a Successful Utility:
With LUS Fiber willing to declare itself over the threshold of success the focus immediately, and correctly, turns to what "What next?"  What can a vigorous LUS Fiber do for the community. That's a spot where I think the utility could use a little community input. What they offered was worthwhile and interesting:
Why wait on Google Internet?
We didn't.

  • Allons TV—The mobile platform upon which HBO Go recently launched and which already contains a raft of other channels (from ESPN to ABC to SyFy) are already making their material available to smartphones and tablets.
  • The Lafayette Intranet—LUS Fiber has long touted a nearly unique feature: the 100 Mbps internal network that makes the link between all subscribers the same speed, regardless of how much or how little they are paying for their data service. To this LUS is adding a 1 Gbps service between businesses. Why not everyone? Well that's a product of the fact the electronics on the sides of residences top out at 100 Mbps practically speaking. Commercial grade electronics doubtlessly are a step up...so there is no extra cost for new electronics to offer this to their business customers but providing it to all the already established homes would be a major expense. But...there is no reason not to make it clear that this IS the issue, if indeed it is, and to promise that LUS will continue to provide "best possible" intranet to all its customers on the intranet. We should all have a Gig. 
  • Wireless Lafayette—LUS has long had numerous hotspots—for the use of LCG and LUS only. But today they announced the provision of their first commercial wireless installation. It will be at  Acadiana Mall and the WiFi signals will be free to all users. That's interesting news in one direction: it implies that LUS is developing a wireless division for large commercial venues. This is actually a fairly good-sized undertaking with its own raft of specialists and maintenance personnel. That is surprising and may turn out to be a significant part of making a larger wireless play in some degree self-supporting. Public WiFi in public places is also on the agenda and is intended for public buildings and the parks. That'd be a good start but not anything very unusual or notable. My guess here is that there is that there is a deep reluctance to devote the manpower and maintenance expense necessary to keep up an area-wide WiFi network until the utility itself is absolutely secure; it costs money. Frankly, that's an outlay that may require public pressure as it would compete with the final benefit that Huval said a successful fiber utility would bring:
  • Cash on the Barrel Head—If customers continue to sign up LUS Fiber can get considerably beyond just paying for itself and saving Lafayette's citizens a pile of cash. It can, Huval noted, also save us on taxes. The mechanism is the oft-discussed (and oft-misunderstood) In Lieu of Taxes (ILOT). Huval projects some 5 million dollars a year in ILOT monies should all the citizens of the city who say they intend to get around to buying LUS Fiber services would just go ahead and do so. That's not at all pie in the sky and would only increase as further customers sign on. The incremental additional cost of new customers, once the basics are paid for is very small; new adds very quickly become very profitable gravy. All that money could go into the city's general fund! Now it may be that there should be some discussion about whether we want it to go there or whether we'd like to get other benefits from our telecomm utility: what about a wireless cloud over the city? or maybe a real attempt to close the digital divide; a task the Council once endorsed? If we want to have that discussion about the surplus LUS Fiber will one day generate I fear we'll need to insist. 
Huval closed with a convincing plea that we should all try and get those the surveys show simply haven't gotten around to subscribing to LUS Fiber to go ahead and do so. The advantages, whether it is saving on our taxes or getting valuable new service, are to great to ignore. He's right. Talk it up. It is to all our benefit. 

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