This is an archived article that was published on sltrib.com in 2008, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.
Provo Mayor Lewis Billings compares the troubled iProvo network to a young woman wanting a date for the prom.
She had better say yes to the first guy who asks or she might sit at home alone on the big night.
On May 6, Billings said iProvo's Prince Charming - in the form of Broadweave Networks, a previously unheralded telecommunications company - had finally called.
The deal raised questions as to how Broadweave won iProvo, and whether the company is biting off more than it can chew. The sale increased Broadweave's customer base 10-fold, and its subsequent purchase of Veracity Communications, brought the company out of obscurity.
"Broadweave has some credibility issues to overcome," said Municipal Councilman Steve Turley. "We have partnered with people before . . ." who wound up pulling out and declaring bankruptcy, leaving the city scrambling.
He worries that the same could happen, with Provo taxpayers footing the bill.
But Broadweave's principals - former Novell attorney Steve Christensen and Sorensen Capital's Fraser Bullock - dismiss those concerns.
"What we have is a scalable platform, an all-star financial team and great technology," Christensen said.
Christensen said he came up with the concept for Broadweave in 1999, when he had a conversation with Bernard Daines, the founder of World Wide Packets. Daines showed him the possibilities that existed with fiber-optic networks, especially if such a network could directly provide service to homes and businesses.
While fiber-optic technology is not a new technology, such networks usually terminate at nodes, where traditional copper wire takes over to carry data to consumers. Direct fiber-optic connections eliminate the limitations of copper wires and allow much higher Internet speeds. And they make it easier to transmit more high-definition television signals.
But wiring a neighborhood with fiber-optic cable is not an easy proposition.
It involves tearing up the street to lay conduit. That process competes for space with other established providers, such as Qwest and Comcast. But that was not the only option, Christensen said.
Another way is to go into "greenfield" developments, where the houses have not yet been built and where streets are being laid out and the trench already is open. Houses can be hooked up as they are built.
Or, Broadweave could buy a system that already is in place. Hence, its quest to acquire iProvo.
"That made financial sense," said Christensen, who sold a former boss, Robert Frankenberg, and Bullock on the concept.
Says Bullock: "In the business world, companies have to be economically efficient." Plus, it is also more efficient to have a single entity operate the network, providing both the service and maintaining the system. Bullock, Frankenberg and former Novell executive Ty Mattingly joined Christensen to found Broadweave.
The company's first test of its business model was Traverse Mountain, a high-end development in north Lehi, near Point of the Mountain.
A fiber network that could offer television, Internet and phone service to the homes was installed. Roughly 1,000 Traverse residents signed up.
But as yet, Broadweave does not control the network and residents aren't quite getting the full Internet-TV-telephone package.
"There was supposed to be television, but the cable [TV] hasn't been available," said Marilyn Hunt, who has lived in Traverse Mountain for two years. She said Broadweave has refunded a portion of her telecommunications bill to make up for the lack of TV service.
Christensen said this experience taught him an important lesson: Control the entire network.
Christensen applied that lesson to Broadweave's next project, Sienna Hills in Washington1 County. The 2,000-home project is being built on school trust lands.
"We felt [Broadweave's] offer was the best combination of technology and service," said John Adams, the state School and Institutional Trust Lands Administration's associate director.
So far at Sienna Hills, Broadweave has built a network-operations center and a fiber-optic backbone for the system. It currently is serving 80 homes with the full Internet, TV and telephone package.
But Broadweave has also had developers and city officials tell it no thanks.
That's what happened earlier this year in Show Low, Ariz., at a 3,500-home subdivision now under construction. City Manager Ed Muder said the city's attorney wondered whether Broadweave was "cherry-picking" the high-end development and ignoring the needs of the rest of the city.
Meanwhile, in Provo, concerns still linger over how Broadweave won the right to purchase iProvo.
Pete Ashdown, CEO of XMission, said earlier this month that the sale should have been advertised publicly to ensure the city was getting the best value.
Turley, the municipal councilman, worries that the city will have to guarantee, for the next two decades, the $39.5 million bond it floated to build the system. And Dave Rusin, CEO of American Fiber Systems, calls the sale "a sweetheart deal."
Meanwhile the mayor maintains that the involvement of Bullock, who was also chief operating officer for the Winter Olympics, held in Utah six years ago, gives Broadweave the credibility it needs to justify the city's decision.
"[Broadweave is] rolled up and ready to go. Others are close, approximate, but they don't bring the whole deal."
What's next?
The Provo Municipal Council will conduct a public hearing on the iProvo sale at 7 p.m. Tuesday at the Provo City Center, 351 W. Center St. The council also is expected to vote to grant Broadweave a franchise to operate a cable-television system in the city.