Tonight I attended a followup meeting with the Roy City council and Jerry Fenn, president of Qwest Communications for Utah. Mr. Fenn was supposed to have attended a regular city council meeting yesterday, but had an unfortunate incident where he went into anaphalactic shock from accidentally eating a peanut, which he’s allergic to, at a local chinese restaurant.

I was unable to make it to the Tuesday meeting, but upon learning of the followup meeting tonight, I made arrangements to be present.

From what I was able to gather, Mr. Fenn had a couple Qwest employees fill in for him and give a presentation to the city council. After the presentation, there were a lot of unanswered questions, concerns, and even raised-voice arguments, which is why Mr. Fenn wanted to personally attend a followup meeting.

Some inappropriate blanket statements were made by Qwest representatives in Tuesday’s meeting such as government should not be running any kind of public utilities (What about all the cities that generate their own power, manage their own sewer, not to mention several that operate their own telephone services?)

One of the issues that came up in Tuesday’s meeting was availability of DSL to areas within Roy City, specifically city council members homes. Mr. Fenn’s assistants provided line qualification information for each of the homes in question at the meeting. Only one home did not currently qualify and that city council member was given the date of 14 May when his line would qualify.

The Qwest representatives wanted to make it very clear they are using remote terminals (neighborhood DSLAMS) to do more to fill in the gaps in coverage areas. They have already installed some remote terminals in Roy and said there would be five more within the next few months.

For the state of Utah, Qwest plans deployment of over 200 remote terminal installations during the first half of 2004.

The Qwest representatives had a couple of issues to address in response to a UTOPIA survey they had in their hands. On issue was lack of control of content. Because UTOPIA would not govern or restrict any data flowing across its network, Qwest seemed to be trying to incite animosity by pointing out that content going across the UTOPIA network (which would, of course, be funded in part by Roy City tax dollars) might contain offensive or illegal elements. This didn’t seem to faze anybody in the room. Chris Davis, Roy City city manager, indicated that to do something about that would amount to censorship and that wouldn’t be appropriate.

Mr. Fenn made the point that during the three and a half years it is said will take UTOPIA to build their network, Qwest will have filled in all the gaps in their DSL coverage areas.

Mr. Fenn used several points to try to persuade city officials that UTOPIA is a bad idea. I’ll try to summarize each one below.

Unrealistic take rates - Mr. Fenn used the relatively slow adoption of DSL in Utah as his proof that UTOPIA wouldn’t be able to attain the customer base it says it can.

Underestimated cost to build - Mr. Fenn said his engineers claim it will cost a lot more than the $543 million. He indicated this figure is only appropriate if the entire project was being done in a “greenfield environment” and not a retrofit of existing utilities.

Overestimated bandwidth demand - Mr. Fenn said Utahns are happy with 256kbps, 1.5Mbps, or even dialup speeds. He said nobody wants 10Mbps to their home and if they did, WiMax technology would provide adequate bandwidth for those customers.

One council member asked Mr. Fenn if the reason Qwest was recently suddenly deploying remote terminals to eliminate coverage area gaps was because of UTOPIA. Mr. Fenn vehemently denied this was the reason. He said the deployment of the remote terminals had been planned and budgeted for months and if there was a driving force behind the deployment it was Qwest’s internal migration to VOIP.

Mr. Fenn repeatedly indicated that UTOPIA has provided no prices for their services and indicated that it was unwise to make any determinations as to the value of UTOPIA until those prices are published. He also indicated that Qwest’s DSL technology was nowhere near any “wall” bandwidth-wise- that they could and will provide 7Mbps service in the future as the demand for higher bandwidth connections begins to grow.

Another issue that came up was about DSL for businesses in Roy. Apparently many businesses can not get DSL service. Mr. Fenn didn’t really address this directly. He tried to explain that this was because there’s a lot more competition in the business services market. He also pushed Qwest’s SONET backbone as proof that (a) Qwest is dedicated to the needs of businesses and (b) Qwest is already providing fiber to the premise for businesses.

Mr. Fenn continued on, saying that Qwest was already available to help cities with economic development by providing broadband to business via their fiber technology.

Several times in the meeting Mr. Fenn complained that Qwest was getting knocked in discussions about UTOPIA because they’re a “monopoly.” ”We haven’t been a monopoly since 1995,” he said. He specifically mentioned Pete Ashdown of XMission making cutting remarks at a Salt Lake City council meeting and then shortly thereafter posting a “kudos to Qwest” message on the XMission website when the 1.5Mbps DSL service was announced.

I asked Mr. Fenn if UTOPIA were to become a reality, would Qwest consider being a service provider on the UTOPIA network. Mr. Fenn took a deep breath and said no, they would not because it would mean turning their back on the millions of dollars invested in the infrastructure they’ve built.

Mr. Fenn brought up WiMax again and went into more details about how it would be deployed and reminded those in attendance that only a distinct minority would ever need the incredibly high speeds (10-20Mbps) provided by WiMax. Another advantage of WiMax, he said, was that it didn’t entail tearing up any streets.

Perhaps the comment I found most interesting that Mr. Fenn made was when he said Qwest could and would do a fiber to the home deployment if the conditions were right. The right conditions, Fenn said, would have to be a new development — a “greenfield situation” and not a retrofit.

Mr. Fenn also spoke about Senate Bill 66 and admitted that it was a “Qwest bill” and that they had helped craft the legislation from the very beginning. He said this bill illustrates Qwest’s core arguments against UTOPIA:

• Government use of tax dollars (including Qwest’s own $2 million/yr paid) to build a telecommunications system to compete against Qwest.
• Exclusivity clause granting AT&T an 18-month dominating presence on the UTOPIA network.

Mr. Fenn said Qwest was not trying to kill UTOPIA with S.B. 66, but to make UTOPIA go back to “the original plan.”

Mr. Fenn also rattled off a list of other businesses and organizations that were also supportive of S.B. 66 including Utah Taxpayers Association, Merit Medical, and the Utah Board of Realtors (I think).

There was a member of the local telecommunication workers union in attendance. I spoke briefly with him after the meeting and he indicated there was some concern about UTOPIA because the UTOPIA plan included hiring contractors (i.e. not union workers) and paying them low hourly rates and not providing them with health insurance benefits.