"LUS fiber project still on schedule"

The Advertiser published a small update on the LUS fiber project "LUS fiber project still on schedule" whose title just about says it all.

The headend building near the I-10/I-49 junction is now up; I was by there the other day and it is a solid looking building—massive prepoured concrete slab walls give a solid impression. It's not the showcase building LUS might have originally wanted but it ought to weather the storms.

But here's the part I liked; a quote from Huval:

"But I can tell you that it's going to be everything we promised and more. We've got people working six-plus day weeks trying to make this thing happen."

That's what I like to hear. (Incidentally, I talked to one of the engineers in charge of the project the other day and from the way she described her job it sounds like the director's description of the work week is pretty much literally true.)

Against the Grain

With the country sinking into a recession and the housing market collapsing nationwide it is somewhat comforting that Louisiana is going against the grain.

Loren Scott, the media's go-to economist from LSU, predicts a continued strong economy and particularly a strong housing market in Lafayette according to an article penned by a local realtor in today's Advertiser.

What did Scott say specifically about Acadiana? He noted many positive indicators including a low unemployment rate, a strong oil patch, a large number of building projects, LUS fiber system, hospital expansions, Acadian Ambulance expansion, Dynamic Industries contracts and discovery of more oil in the Gulf. In other words, Acadiana has a vibrant economy and an excellent housing market. They are predicted to remain strong for the next two years. (emphasis mine)

What's interesting in the context of this site is that the LUS FTTH network has already graduated from a gee-whiz, that-would-be-neat-if-they-get-it status to an accepted, off-hand element in a list of strengths for the region.

Here's to hoping that the lower prices, an amazingly advanced product, and better service that LUS Fiber are bringing will do its part in keeping the wolf from the door locally.

Kaplan Telephone talks Fiber

The Advertiser has a short article this morning on Kaplan Telephone's fiber to the home buildout. Longtime readers will have seen laudatory mention of Louisiana's local projects on these pages over the years. Of the three privately held small, local telephone companies building fiber that I know of Kaplan is by far the least assuming. (Eatel, Cameron Communications, and Kaplan Telephone are the three.) When I have checked their website over the years they've always said a version of "coming soon." They still do, not withstanding the Advertiser's reporting that half of Kaplan is connected to the system. An interesting point is that Cox is in Kaplan...the local boys aren't doing too shabby.

The website doesn't mention a price for FTTH service indicating to me that they aren't yet differentiating between their DSL and FTTH connections—nor offering fiber's capacity to their customers; the description of their service indicates slower DSL speeds--up to 1 meg range since dialup is 56K and the advertised 15x would be 840K. It's not entirely clear that they are offering anything beyond DSL electronics and a standard phone modem hung off fiber with those sorts of numbers. That may explain why the company is reticent to describe their network as a FTTH system on their website.

Kaplan does directly sell what sounds like a faster WiFi point to point wireless broadband product though...and I'd be interested in hearing about how that is deployed and where it is sold.

Kaplan Telephone, EATEL and Cameron Communication do prove that it doesn't take dense populations or big city smarts to run a fiber network. What it does take is a local company willing to serve its community.

EATEL Joins Fiber Fight

The fruits of competition...

That image to the left is a full page ad in the A section of today's Sunday Advertiser. Click on the image for a large, readable image...(caution, it's a big jpg.)

EATel's experience in their fight over in Ascension parish ought to inform ours. Clearly Cox "Greater Baton Rouge" is offering special deals only to EATel's customer base—possibly only to those that have threatened to move to the local, more powerful, fiber to the home alternative.

That, as EATel is pointing out in this ad, isn't fair pricing. You've got to offer the same deals to all. Otherwise you are engaging in a form of predatory pricing. —But you don't have to promote the great deal everywhere...On the other hand you do have to be willing to give it to anyone who asks for it.

So EATel is engaging in the wildly unusual act of promoting a great deal from its competition so you can ask for it. Cox can refuse, of course. If it does you should tell EATel who is surely preparing a lawsuit alleging unfair competition if this deal isn't offered fairly. Or Cox can honor the offer. Which would be hugely expensive if any number of people take it up outside of EATel's relatively small service area on the south rim of Baton Rouge.

It's a good deal. (And will cost Cox real revenue whenever and wherever it keeps this promise. It's evidence Cox is running scared.) But folks here in the city of Lafayette that are in the first build area would be best served to hold off. (IMHO) A better product is coming in nine months with hugely faster net speeds that will keep those dollars in local hands. (That 100 megs of intranet speed is going to make a whole lot of difference. I had two conversations at a party last night that revved me up on that score.) And even if localism and a superior product don't make your choice as easy as mine will be wait a little while anyway. --The closer LUS gets to launch the better the deals for Cox's standard alternative will become. This is only the first offering.

Folks outside Lafayette's first build should look into this. If Cox is going to push the bounds of fair competition with their small local competitors they shouldn't be allowed to do it secretly or cheaply. Fair Competition. That was what Cox wanted. They ought to be held to it. Call 'em and ask for the deal. What you want to do if they give you any guff is mention "Special Promotion R-123" — that detail is in the fine print at the bottom of the ad.


Cox was foolish to combine the Baton Rouge and Acadiana markets. Now they've got a two front battle on their hands and the contrast between little, local alternatives with a superior technology and the huge predatory out-of-state corporation with old technology will be inescapable.

Justathought: LUS should consider some coop advertising deal with EATel. I get the Baton Rouge Advocate and there's no similar EATel ad in it today.

Cox: New Building, Old Line

Cox Communications has opened its new headquarters for what is left of its operations on our side of the Atchafalaya basin. (Cox shed its former holdings to the north and west back in 2005) It's a serious investment in the region and looks like a nice building—complete with meditation rooms. The Advertiser's tone is in the traditional laudatory vein that local newspapers inevitably adopt whenever a company opens a new building or invests in the area. It's a welcome relief, I am sure, from the usual grind of the news beat where "good" news usually means "no news" and I'm pleased that Cox, its employees, and the area have a new building.

But I can't help but be annoyed by Cox continuing to run out its silly "Me too!" line about it having fiber and nobody knowing about it. [Note that the online version has a final "press release" paragraph on fiber that didn't make it into the print version.] This is smoke and mirrors and it is intended to confuse the public about the difference between Lafayette's new system and its older one. It also reveals that Cox still doesn't understand what happened during the fiber referendum fight and why it lost that fight.

Cox has tried, in its press releases and its advertising to say that it has "a fiber network." This article, to its credit, doesn't repeat the silliness of using that phrase—whether that is due to the good judgment of the writer or the fact that Cox has quit trying to run that particular form of misinformation is not clear. Just for the record: the implication that Cox has anything like the fiber to the home network that LUS is currently building is just silly and Lafayette is now sophisticated enough to both understand that and to understand why Cox would want to obscure the difference. Every network in town has a fiber core: Lafayette's ring, AT&T's network, Cox's, and the miscellaneous national networks that also have terminations in our city. Cox, like all its competition uses fiber's massive capacity as a the cheapest way to handle massive amounts of bandwidth where it has to have that capacity: in the backbone that supplies the less capable copper leading to homes. Having a fiber backbone just isn't noteworthy—what is noteworthy is how close you bring that fiber to your final customer. Only LUS will bring that massive capacity all the way to your home or business.

What's more interesting to me than that old story is that telling it seems to mean that Cox actually believes that it lost the vote in Lafayette because the people believed that they wanted "fiber." So Cox is determined to pretend that it will give us fiber (not quite to the home) too.... But "fiber" is not the reason that Cox lost that election. It lost because it tried to deceive us about fiber to the home—something it is still trying to do with its current PR double-talk. In the end it all came down to trust. And Cox proved itself, through deceptive PR, silly "academic forums," insulting push polls, threats to our jobs, and endless rhetoric about the dangers of a trusted local utility providing local services cheaply that it couldn't be trusted. Every time its PR personnel try pass off some half-true claim about fiber networks Cox reminds us why we didn't trust them back then. Until it figures out why it lost in 05 Cox will continue to lose in Lafayette.

-----on reflection------
Truth is that fiber isn't all that Lafayette wanted by the time we got to the end of the fiber fight. By the time we voted we knew we wanted to control our own destiny and the fiber fight just proved the context for coming to that decision. As our national history has played itself out telecommunications has turned out to be an essential, and a monopoly business. Those sorts of businesses ought to be public utilities, not private monopolies. It took our wanting fiber and the ugly battle to win it to get Lafayette to realize that. But now we understand that every community should own its own network. Even if it isn't fiber. The social and economic benefits of controlling that locally and keeping that economic stimulus entirely in local hands is enormous and every community that can ought to do the same.

It isn't fiber.....it is trust...and local control.

French & Fiber

The old saw goes: "Play to your strengths." The Advertiser's Bob Moser pens a blip that points to a set of new economy jobs for Lafayette: "Foreign" language call center agents. It's a work-at-home job that routes calls from non-english speakers to bilingual agents. The money, like all call-center money, isn't grand but the job setting can't be beat, especially for shut-ins or stay-at-homes.

Many of Arise's larger clients in retail are expanding their call center contracts to regions of Canada where they sell to French-speaking customers. They've begun rerouting more English and French language customer calls from Canada to bilingual agents in the U.S., said Jared Fletcher, vice president and ACP of admissions and certification at Arise.

The job requirements are fluency in a second language and fast internet connection.

It's no wonder that Arise Virtual Solutions is recruiting in Lafayette--according to the last census a healthy 13% of the city speaks french in the home. And, as readers well know, a really fast net connection—more than sufficient to access reams of data for customer suppor—will soon be both cheaper and faster from LUS.

Fiber and French make a good pairing.

Cox to Raise Prices

Cox Communications has announced a plan to raise prices this coming April 1st according to a business brief in this morning's Advertiser. As far as I can tell from the brief article it means between a 3 and 10% jump for most subscribers depending upon services taken.

Most video subscribers will see a bump of between 2-3 dollars according to the article. The basic cable package (channels 2-20 in analog) which has had channels and services removed recently, will not experience the same increase. Internet subscribers will also be hit with an increase in the 3 dollar range. That makes for around a 6 dollar jump for those folks who buy both services from the cable company.

Cox claims this is the first price increase in 19 months and claims it is made necessary by channel costs. That makes surface sense of a kind but isn't easy to reconcile with the fact that the number of bandwidth-eating HD programming channels included in the new packages is slated to increase. —Channel costs increase independent of pricing if you provide more channels and use more of your resources in doing so.

There is some unexplained confusion between the information presented in the article and what is offered on Cox's website. For instance, the basic tier is described as being channels 2-20 but the Cox website for acadiana describes that level of service as covering channels 2-23 plus access to 3 more digital channels if you pay an extra hardware fee. Are 3 more analog channels being silently eliminated, effectively but invisibly raising the package price? It sure looks that way.

Subscribers to internet services will get a bump with their price increase, though the Advertiser's write-up is also confusingly written on this topic (though it may simply be following a misleading press release). Consider:

Cox is also boosting the speed of four tiers of its Internet service, allowing customers to connect and upload content more than twice as fast in some cases. Cox's Value tier, it's second least expensive at $26.95 per month, will now offer 1.5 megs per second, a 486 percent increase in speed, for $3 more per month,

There are only 4 speed tiers and the "value" tier (about which some detail is given in the Advertiser) is now $26.95 with download speeds of 1.5 mbps and 256 kbps upload. I don't see how "now" offering "1.5 megs" can mean a 486% increase in either the upload or download numbers. My guess is that the upload speed, which at 256 mbps is pretty pitiful, is being raised substantially. But that is only a guess. If that is all that changes most subscribers won't feel that is worth a 10% bump.

A new expansion is pointed to that might actually be worthwhile:

HD Free Zone OnDemand will go up, allowing subscribers to watch popular basic cable programs whenever they want.

If "basic cable" refers to the basic cable tier, as its context in this article might indicate, then that would be real news as it would indicate that local stations and AOC were going to archive their news and other locally produced shows and allow Cox to rebroadcast them on demand. That would be a great thing for Acadiana and worth applauding Cox for showing some real vision. However, if "basic cable programs" just refers to "regular, widely available on lower video tiers cable shows" then this isn't very interesting and is just a continuation of what is happening without any special price rise. I have to suspect the latter but can wish for the former.....

--------
In any case, this price bump will surely make it easier for LUS to keep its promises to offer a lower-priced alternative to Cox and AT&T. Prices for Cox are, in the end, driven by national factors and intra-company competition which don't take into account local competition like LUS. The only way to compete on price with LUS will be to make the local Baton Rouge-Acadiana network the corporation's least profitable division. Nobody, least of all local Cox officials, will want to let that happen.

French on Basic Cable

Just for the record:

A letter in today's Advertiser rasises, again, the question of whether the French-language channel should have been moved off of Cox's basic cable lineup.

And the answer of course is "no"—it should not have. In a city where the census says 13% of the population speaks French in the home it should be. Communities that call themselves Cajun, Creole, and French all speak a unique local version of the language and ought to be served.

We lost easy access to that channel when Cox decided it would be more profitable for them if Acadiana was made more like Baton Rouge. So they combined the two areas and aligned Lafayette's channel offerings with Baton Rouge's.

Unwise. And it is an issue that will not go away.

My guess is that this is not a mistake that french-speaking cajun fiddling Terry Huval will make. There is no reason why TV9 can't be on channel 9.....except that Baton Rouge has a channel 9 on broadcast. But that won't bother a local cable company.

Full Page LUS Fiber Ad

The Sunday morning Advertiser has a full page LUS Fiber ad...the first, but not the last, we'll see.

At left is the page. The blue banner is explanatory—they want folks to know that they'll be seeing "visible signs of progress" because the "crews will be working hard to bring you a fiber-fast, fiber-fantastic network." (Whew!) "And with it , lighting-fast internet speeds an miles of expanded bandwidth. Plus crystal-clear cable TV and telephone service" Now that's somewhat florid language but not inaccurate—we hope. You can get a larger picture by clicking on the one at left.

The pic below is a scan out of the ad... if you click it to get the big picture you should be able to read the ad text yourself. And for local fiberistas it is a lot of fun to read...and reassuring to see list of all the things we've been promised make it into advertising. It's one thing to tell the loyalists what they want to hear and quite another to put into print advertising.

And the advertising is still more conservative than the talk...the promise in print is that the triple play will average 20% less than Cox (and AT&T if it every gets around to offering its cable package.)

The body copy opens with a bit of bragging: Fiber to the Home and Business Technology is the most advanced means to provide what is typically referred to as a 'triple play' of communications services—cable TV, phone, and high speed internet—directly to homes and buisneesses. There are no FTTH systems serving entire commuities in Louisiana and very few in the U.S.

Other bullet points:

• will serve apartments (Happily for competitors like LUS the FCC is trying to outlaw exclusive apartment contracts—the cable companies are, of course, suing)
• local programming and stations
  
• advanced phone options
• Video on Demand
• DVRs--Digital Video Recorders
• Channel guides

Media Roundup of Phase 1 News

All the local media has at least a blip on yesterday's announcement of the construction schedule of our new fiber to the home project.

If you want to run down the list here are the links: Advertiser, Advocate, KLFY, KATC. There is a lot of overlap.

If you have time for only one you should spend it on the Advocate's coverage (and that's not because yours truly is briefly qouted.) The article spends less time on describing the boundaries—which is better dealt with via a map anyway—and more on the why of the build schedule and immediate plans for other elements of the startup like the storefront and headend construction. There's also a brief bit about expansion:

There are no plans to extend LUS service outside the city limits — as LUS is owned by city residents — but that doesn’t mean LUS Fiber service couldn’t one day extend into the parish or the smaller municipalities, Durel said.

Outside areas could annex into the city, or they could raise the revenue necessary to provide the infrastructure LUS would need to provide service, Durel said.

Several reporters talked to Durel about this issue and he was pretty expansive...I'd stay tuned. Lots of people in the parish want this and it's only now sinking in that this is a city build.

The Advertiser's full article adds some man-on-the-streeet remarks from residents that are pretty typical, I think. But more interesting is the discussion in the comments section of yesterday's brief online blurb following the press conference. As much as the omnipresent reflexively resentful naysayers irritate me I have to say that I was proud of the level of understanding of a pretty technical issue that the pro-fiber crowd showed in forum often noted for its ugliness, and uninformed "opinionating." I don't think you'd see that level of technical and economic sophistication in many places—or here before the fiber fight. Politics can be educative. It was also interesting to note the folks from outside the area that are following this issue closely enough to find the story before it is actually published in the paper. Nevada and Germany are on the list....and surely many more who are also watching attentively.

Advertiser Editorial Heralds Fiber

This mornings' Advertiser heralds the imminent startup of Lafayette's fiber-optic network with an editorial that promotes the economic benefits of technological leadership:

We believe LUS Fiber will mean more good-paying jobs and a better quality of life for the people of Lafayette. The availability of advanced, affordable telecommunications services to assure the ultimate efficiency in the transfer of information will be a priority of businesses looking for places to locate or expand operations.

...We have no doubt that LUS can stay abreast of technology. Lafayette has experts in all phases of telecommunications technology. There is a rich field from which to draw.

The plan is seen by national publications such as USA Today as a visionary, pioneering step toward a place of leadership in the global economy.

While generating revenue is essential to paying off the bonds and keeping up with constantly changing technology, revenue is not the basic goal. Competition will result in better rates, but as desirable as that is, it is still not the focal point of the Durel administration’s vision. The vision is one of technological leadership that will result in powerful economic growth.

That's what the Durel administration and, by implication, the Advertiser find most valuable about the project. And there is no doubt that the promise of clean, high-tech growth responds to realistic anxieties coming from the great oil bust of the '80s that seriously undermined the city's natural sunny confidence.

But to my mind the real benefit is more basic and has even broader consequences: Lafayette can now control its own future in one additional and increasingly important area: Communications. This generation of citizens has made the gift of an extra few degrees of freedom and responsibility to the future. It is what we do with that Freedom and Responsibility that should now occupy us.

Fiber Worth Moving For?

FiOS, Verizon's fiber to the home project, is so good that people are willing to move to get it. At least that is what some geeks that Ars Technica talked to think.

In this month's issue of Consumer Reports, the magazine took a look at ISPs and declared Verizon's fiber optic FiOS service to be best of breed. Not only that, but the FiOS television service trumped all comers, including DirecTV, AT&T, Comcast, and Time Warner. Top honors also went to FiOS phone service, which beat every other telco and cable company for reader satisfaction. The fact that FiOS gets such high marks may be the reason that some people have even moved to get it.

Andru Edwards of Gear Live tells Ars that he's one of those willing to relocate for the promise of fiber optic goodness. "I moved 10 minutes north of Seattle specifically for FiOS service..."

That's top in reader satisfaction in three separate categories: Video, Phone, and Internet services...That's pretty amazing. Now that's NOT for Verizon's regular service, please note. That's for the FiOS (Fiber-Optic Service) that Verizon offers in a various places across the country.

Surely Verizon, with a big investment in expensive infrastructure, is going to try and put their best foot forward. But to impress users as the best you have to actually have to have an outstanding product to sell them.

Apparently fiber to the home has let Verizon offer an outstanding product. And I am completely confident that LUS will offer an even better version.

So, will people move to Lafayette to get an even better version of fiber?

There has been speculation that individuals might move to Lafayette to get our product. I admit that I've thought that a bit unlikely even though Durel has said he's heard of people coming home because of it. But then on top of the interesting story cited above I saw this bit tagged on to the recent LUS groundbreaking story in the Advertiser's online forum from a reader who lists his or her location as "Las Vegas, NV (migrating to Lafayette in '08)":

May be the best thing ever to happen to Lafayette. We were scouting future possible locations in Louisiana for a move from Las Vegas. As soon as we saw the FTTH initiative announced, we knew that Lafayette would be our destination.

Congratulations to Lafayette specifically and I'm sure that Louisiana will benefit too.

And former Councilman Menard might not have said he plans to move...but he has said he'd like to be annexed.

Hmmn. Maybe there's something to all those rumors. That's one way to keep the housing market healthy.

LUS Groundbreaking in the Media

The media covered yesterday's groundbreaking in force. The Advocate, the Advertiser, and KLFY all have online stories you can check into.

The Advocate's story is the most extensive. In addition to covering the statements by public officials it also explored recently let contracts:

Chain Electric out of Hattiesburg, Miss., has been awarded the approximate $11 million contract to install underground lines — in areas where utility lines are already buried.

Where utility lines are already on poles, the lines will be run by an Indiana company, ElectriCom Inc., as part of a $4 million contract.

But the reporter tripped up a bit when trying to summarize the recent contracts as Blanchard acknowledged when I dropped him a quick question. But the Advocate quickly corrected it online. I've edited this post to account for that, striking the parts that no longer apply. The following bit that appeared in printed edition isn't correct:

LUS Fiber’s Mona Simon said only one of those contracts — the underground line contract — came in under budget. The same goes for the head-end building construction, as well as the large contract with Alcatel-Lucent, which is providing all the large electronics including the boxes that will be at customers’ homes and businesses.

In fact, you need to invert that meaning: only the underground line contract came in over budget.

The story has been corrected online--the portion struck above portion now reads:

LUS Fiber’s Mona Simon said only one of those contracts — the underground line contract — came in over budget.

That's not entirely surprising since digging up yards carries a lot of unknown risks--nobody can "look" at the job and see what it really entails. I'd bid high on any job of which I wasn't confident.

If you're curious as to how LUS will pick the first area to be served (and who isn't?) you should check out the story:

LUS is picking the initial areas on using three sets of criteria, Huval said.

The first is which areas could provide the most potential customers at the lowest cost.

The second is which areas have a good mixture of residential and commercial — though with an emphasis on residential, as those customers are more likely to sign up in larger numbers.

The third is an area with a mixture of overhead and underground utility lines — again, with an emphasis on overhead lines because running fiber on poles is faster than having to bury them.

The idea of picking a diverse area is to get early experience and feedback in all aspects of the roll-out, Huval said.

That would describe almost any area of the city....though I'm personally hoping that it best describes the residential areas right around downtown. ;-)

The Advertiser's story is much briefer and focused more exclusively on the event and quotable quotes from the participants.

Huval said the service will have a long-lasting impact for residents and businesses.

"The real purpose is to provide a super broadband highway," Huval said. "We're going to be primed for new technology."

City-Parish President Joey Durel said the service is going to "be something much greater than we ever dreamed."

"We have underpromised, and we're going to overdeliver," Durel said. "A lot of things had to come together, but it's here and it's going to happen and we're going to knock your socks off."

There's a picture of of Huval with Mike Stagg, Keith Thibodeaux, John St. Julien, and Gobb Williams in the background. (I'm still looking for that pic with with Gobb Williams and Durel both holding golden shovels, digging them into the council carpet, and grinning like mad.)

KLFY has only the briefest of stories, but if you own a windows machine you can probably view the video. (I'm weary of complaining...but will note that the mac market share has hit 8%, and the percentage of internet users on that platform is higher yet... Maybe the Advertiser will publish one of its nifty multimedia stories that are easily the best edited, and most accessible, net video in Lafayette.)

"Cable TV may go à la carte"

There's a little surprise for media watchers in today's Advertiser: a media story that appears to have no immediate hook or sensational event to drive it to print. —A media story that seems simply to educate about an issue that consumers care about. And since Lafayette consumers will soon have a say about just how we structure our own cable offerings this is one of the few places where such an education might have practical consequences. Good for the Advertiser.

The issue is à la carte cable programming—the idea that you should be able to choose individual stations from a menu of choices instead of being forced to buy your cable programming in bundles determined by the seller. A short excursion into the phrase "à la carte" should be helpful in giving the cable story some context.

VS

Á la carte comes from the French, and the restaurant trade there. It means "on the card"--on the menu. The contrast is between à la carte and prix fixe. The "fixed price," prix fixe, is a full, usually multi-course, meal. There is no menu of choices. In the pure case all patrons eat the same meal and it is inexpensively priced for the courses offered. Some restaurants only offered fixed price—fixed choice menus. This option is rare in the states. Tujaques in New Orleans serves the same five course meal to all comers and is the only prix fixe restaurant I know of that survives—and it was an old institution when people now old were young. American's don't go for fixed price/choice restaurants when they have a choice. What American restaurants from McDonalds to Galatoire's share is the à la carte menu format.

That contrast makes it easier to see why the current prix fixe cable programming model offends people. And it makes clear why the cable people's objections don't seem very important to most US citizens. Cable providers say, as the story demonstrates, that allowing people to construct their own cable "meal" from a menu of choices might end up causing their customers pay more.

They claim to object to that.

Sharon Kleinpeter, vice president of public relations for Cox Communications' Greater Louisiana Region, says it may do more harm than good in the pocketbooks of cable companies and customers.

While it's pretty much true that an à la carte menu means less income for cable companies like Cox it is also pretty clear that it does NOT mean more costs for most consumers. Fixed price formats make it easy for the seller to minimize the costs for a deluxe meal...you can buy only what materials you need in quantity, and waste, server, and cook time is all minimized. A huge pot of a savory soup costs little to prepare and keep ready. Keeping five soup choices ready for the 5% of people who order is considerably more expensive. Galatoire's is understandably more expensive than Tujacques for the "same" meal.

But we don't all want the same meal.

If we don't want a desert or a soup we don't want to be forced to buy it and watch it go to waste. That is the real trouble with current cable business model and the cable companies are in the position of the old fixed price restaurants. They know that they can't provide the same fare they've been providing without charging more if people are allowed to refuse to pay for the soup or the salad course or the drink. And they can't charge enough more for the main course to make up the loss from selling far fewer high-margin salads and drinks. It is true that a change is not a good deal for those few patrons who continue to order the five course meal; those patrons will pay more. But most, history shows, won't. And the average customer will pay less and cable companies will have less income--and have to work harder to get that income. In fact the average cable customer watches just seventeen channels, according to the FCC, the article says.

What is revealed is that the folks who want to eat cable modestly have been subsidizing the patrons who want the deluxe version. Those who would order all the fancy trimmings get it for the cheapest possible price. But those who only want a quick sandwich at the end of a hard day pay more. The many have been subsidizing the appetites of the few.

Consumer advocates have noticed:

Consumer Federation director of research Mark Cooper points out that the current system forces subscribers to subsidize channels they don't watch.

"The current system requires everyone to subsidize ESPN viewers," points out Mark Cooper, Consumer Federation director of research. "Why is the cable company making these choices for people?"

Well, the short answer to Cooper's question is the same as it is for prix fixe restaurants: They can make more money with less effort off a large volume of business, much of which is low cost, than they can if most of their clientle is transformed into price-conscious consumers of only the products they like best.

The equasion is pretty simple and the same, both for the cable companies and for consumers. Where they differ is in what they want out of the relationship. And in cable, restaurants, and marriage that makes all the difference in the world.

Something for us to think about here in Lafayette where the owners of the restaurant are the customers. How do we want to arrange our video world?



Lagniappe: If you'd like to look at the article in Gannett's "The Tennessean" that apparently inspired this story you'll find some interesting details about federal policy, the role of advertising in this game and other fascinating (to a few) bits and pieces neither I nor our local reporters bothered with.

Disturbing Representative Remarks

Last nights League of Women Voters Forum for the Lafayette Representative races yielded some disturbing remarks according to an article in the Advertiser. In toto:

Asked if they would support or oppose legislation that would repeal or dilute a 2004 law allowing the Lafayette Utilities System fiber-to-the-home project, all three candidates said they would not support changing the legislation.

Cox Communications, BellSouth and others worked with LUS and legislators to draft the legislation so that it would be fair, Williams said.

All three said the competition will be good for consumers, lowering rates.

Well, the last remark is true and encouraging competition is a good reason to support Lafayette's network after they leave for Baton Rouge. Competition will be good for consumers. But that wasn't the question. The question asked was:

"Lafayette's Fiber To The Home project--approved by the voters in July of 20O6—was delayed by a series lawsuits based on an 2004 Louisiana law, the "Local Government Fair Competition Act." Some Lafayette Parish Representatives introduced or supported bills to modify or repeal it in the spring of 2006.

Would you favor or oppose repeal of this law? Why or why not?"

If the concern is to promote competition in order to save their constituents some cash then the right answer would be: "Yes, I'd consider changing the law in ways that make it easier for LUS to give our citizens a break." I'm disappointed that our representative hopefuls seemed unfamiliar with the fact that the law actually operates to restrain competition. (As discussed at length on this site (e.g. 1, 2), the law does nothing to control prices—as far as consumer prices are concerned the "fair" competition act ONLY puts a floor under what LUS (and only LUS) can charge. It limits the price breaks the utility we own can give us.) Certainly the delaying lawsuits that were enabled by the law were big news--everyone should know that this incumbent-sponsored bill cost the taxpayers a bundle of money but some may be less familiar with the way that it works to force LUS to charge us more. Badon and Hardy could take the position that they really weren't too familiar with the story and that "of course they'd love to save the public some money if getting that law out of the way would help" but Williams was at the heart of the fight the whole time as a city councilman and can't credibly plead ignorance. His naive take is very disappointing. He should understand this stuff by now.

LUS-Alcatel Deal in the News

Both the Advertiser and the Advocate cover yesterday's announcement that Alcatel will provide the electronics for Lafayette's FTTH network. (I attended the press event and wrote up a piece yesterday.)

From the Advertiser:

Alcatel-Lucent was chosen from among six companies to provide the equipment - from the box on your house to the box atop your television set - that will bring Lafayette Utilities System's fiber technology into area homes.

From the Advocate:

The system that the Paris-based company will install will be able to provide all the bells and whistles just coming onto the market — and be flexible enough to provide new applications in the future, LUS Director Terry Huval said.

“We will have the ability and capacity to do things in Lafayette that most of America won’t have for years,” City-Parish President Joey Durel said.

and

For customers, the system Alcatel-Lucent will provide will be able to provide both the most basic of services — such as traditional phone or cable services — as well as services “previously unimaginable in Lafayette,” according to a LUS news release.

Those services include Internet Protocol Television, or IPTV, which sends television signals in the same general manner Internet signals are sent.

IPTV allows for a number of customizable services for end users, Alcatel-Lucent’s Jennifer McCain said.

Users can create their own “home page,” on their television, customizing lists of their favorite channels, doing some limited Internet surfing, gaming, sharing photos or even, someday, shopping — all over their television, McCain said...

Because the box at a customer’s home that delivers IPTV is like a small computer, when new applications become available the computer can be reprogrammed, McCain said.

The potential of the set top box is all but unlimited--it is, as has been remarked on in these pages before (more), a media-ready computer that has been locked down to serve limited, revenue-generating purposes. The boxes are all much more powerful than they are allowed to be. The more we can unlock their potenial as a computer the better it will be for the people of Lafayette.

Finally, what I think will eventually prove the most "feature" part of the system—and a feature we are proud to have first promoted on Lafayette Pro Fiber: 100 megs of intranet bandwidth. The digital divide committee also made a strong pitch for this concept in their "Bridging the
Digital Divide" document. The appearance of this on the feature among the RFP proposals that Alcatel and others had to respond to is evidence that LUS does listen. Terry Huval is calling this peer-to-peer bandwidth and that points to the crucial feature that it is only available between members of the network.

The system will also be able to provide a special twist on Internet service that LUS has promised — nearly unlimited bandwidth inside the LUS network.

Internet customers, no matter which speed they sign up for to browse the Internet as a whole, will be given a full 100 Mbps when contacting another computer inside the LUS network.

Having such a unique capability in Lafayette could help drive innovation, Durel said.

Durel is right; it is hard to imagine what could be done with that sort of intranet bandwidth. But I'll try in a subsequent post. ;-)

The point here is that the train is leaving the station. Alcatel's techologies will shape the first iteration of the system and, at first glance, they and LUS' choices appear to be forward looking and leave a lot of room for growth in whatever direction the larger technological ecology takes. The inclusion of IPTV technology in the video category coupled with large internal bandwidth, and LUS' long-stated commitment to an open system ecology in the internet part of its offerings insure that Lafayette will have the tools, and more importantly, the open running room in which to create something truly different, ground-breaking, and valuable to the community.

Now all we have to do is our part: get down to work and invent the future. Have fun!

(As I wrote up this review I had to restrain myself from expanding too much on several points. Follow-up posts exploring some of the issues suggested by yesterday's press event and this morning's stories are slated to follow..)

LUS FTTH Storefront Planned

LUS has announced a plan for a storefront that will likely prove the face of LUS Fiber. According to this morning's Advertiser:

Lafayette Utilities System is looking for retail space to set up a showroom for its fiber-to-the-home products.

"When customers come in and want to sign up, we're going to have a showcase where they can see some of the products in action," LUS Director Terry Huval said.

That sounds great--and it is the first concrete sign that LUS understands that it is entering a market in telecommunications services that requires a different sort of relationship with the public than that of a traditional utilities supplier. Putting out a technically advanced, low cost, reliable service (a fair characterization of LUS' other utilities) is not sufficient. LUS will need to sell fiber. Aggressively. It will need to tell the consumer why FTTH is better and show them how our local utility can do an excitingly superior job.

A storefront "showoff" location is a great idea and a great way to introduce the advantages of LUS Fiber to the people. The committment to such a store shows that LUS is coming to grips with the idea that being a credible competitor involves the perception as well as the actuality of quality.

Just to be blunt: Cox gets it. (AT&T doesn't, at least not locally) Since losing the fiber fight Cox has been pursuing a high-profile strategy of affiliating itself with local organizations and with ULL in an attempt to cut into LUS' perceived hometown advantage. It has aggressively--using both the public media and its background chatter to "influentials"--tried to sell the idea that it has a "fiber network" when what it really has is a perfectly standard cable-style hybrid fiber-coax network like any that you would see more honestly described elesewhere. That is an attempt to cut into LUS' perceived technology advantage. Cox has an uphill climb on both counts: LUS is owned by the people of Lafayette and Cox is a huge corporation run out of Atlanta and owned by a small family. LUS has an inescapable home field advantage. Cox's hybrid fiber-coax switches from fiber to copper coax at a node shared by somewhere in the neighborhood of 500 homes (or more--Cox is cagey). LUS fiber goes straight to each home. LUS will provide more for less in every category using that more capable and cheaper-to-maintain system. Again, actual advantage to LUS. What Cox "gets" is that it can blunt those actual advantages by pushing a strongly as it can the perception of something near to equality. LUS' task is to not let that go uncontested. The storefront will be a great forum for insistently demonstrating the local utility's advantages.

I have to hope LUS will model itself on Apple's storefronts. Slick, hightech, "cool" presentations of the best technology, coupled with a special cadre of "genuises" to answer technical questions and give reliable technology advice have made the Apple Store chain into an enormous win for Apple. Designed as much provide a reliable showcase for the company's advanced technology as to directly sell products the Apple Stores are now regularly cited as an important factor in Apple's increasing market share. It is easy to imagine an "LUS Fiber Store" (somebody needs to start the branding machine up!) that is filled with big HD flatscreens, computers, and phones all interlinked...the flatscreen serves as big display monitor, phone messages can be retrieved on the computers, caller ID that flashes on TV when the phone rings, linking in to address books on the 'puter or online to place VOIP phone calls. A few VOIP video phones for fun. Some WiFi phones for the adventurous mobile user. Demos that show how to integrate iPhones, Blackberrys, fancy PDAs into the system's hooks. Demos of cheap security cam integration. In-home wifi advice. Digital Video Recorders that you can program from work. ...I could go on here for a long time but you get the idea. These are all things that really have to be shown to be compelling. But once shown they are compelling. (I'll give up my TiVo DVR and home WiFi when you pry them from my cold dead fingers. :-) )

The storefront is a bit of a surprise to me. But I'm thrilled with the idea. I don't know that of any other muni fiber provider that is doing this (I'd be happy to be corrected) and it represents yet another way that LUS can push home its advantages.

Fun! I'd line up for the opening. ;-)

Sun's McNealy Returns

Well Scot McNealy of Sun Microsystems was back in town...and closeted with a lot of the cities tech big wigs (LUS, LCG, the University, and local business—tech enthusiasts) for a couple of hours before a press conference at LITE. Sorry I didn't get to this earlier, but I was mired in a recalcitrant web site that was too close to launch to neglect. But luckily the regional media covered it in force. What happened in that meeting—why McNealy made a return trip—was not immediately made public though hints could be gleaned from the reporter's coverage.

The Advertiser lead with and focused on the announcement of Lafayette's ranking on a jobs growth ranking and didn't mention the McNealy press conference, at which the ranking was mentioned, until paragraph five. KATC and The Advocate lead with the McNealy visit itself and didn't mention the job growth ranking which was apparently a reference point in the presentation. The two stories do dovetail, of course, but the focus of interest on this site is the technology issues implicated in the visit.

Seasoned readers will recall that McNealy made a supportive stop here right before the fiber referendum. He appeared on one of Joey's morning radio shows and was generally encouraging about our building a fiber system. Back then I laid out an enthusiastic, but I think still pretty accurate assessment of the potential of a Sun-Lafayette partnership. The gist is that LUS' big bandwidth, Sun's open source source software, and the immense potential of on-system storage and distributed computing in Lafayette's intranet has got to have smart companies like Sun thinking hard about using Lafayette as a test bed for new technologies. There really will be little to match the size and diversity of our user population, or the intranet-speed in-system bandwidth supplied between customers. That is a match made in heaven for those that have hankered after the bandwidth to make real changes in the (computer, video, cloud computing, name-your-techish-dream) area.

Sun's bread and butter has been building top-notch servers, and more recently, integrated server farms. That's a business built on the need for fast networks. Sun has in recent years pursued some pretty interesting ideas pretty relentlessly. Sun signed onto the open-source movement early. Free and more importantly open, readily fixable and extendable software is the result. Sun has also swum against the tide in insisting on a pushing a "network-centric" computing model. This involves big central computing facilities and distributed dumb terminals — though some Sun models can run as traditional independent stand-alone computers. Sun also has relentlesly pursued its vision for JAVA. The hope was for a platform for writing software that was independent of the underlying hardware and could run and interconnect processes on everything from toasters to big iron server hardware. JAVA has yet to becom the platform for realizing the more blue-sky versions of those dreams but much of the intuition is being realized in web-centric AJAX apps.

The potential of having a whole community with fast, cheap, universally available broadband capable of ripping the roof off the network limitations that have kept many of Sun's ideas barely viable has got to be tempting to the company. And the digital divide and development potential for Lafayette are obvious. There is surely partnership potential here.

But what is on the table now? I'd guess both LUS' fiber program and the city's computing needs.

Keith Thibodaux regularly complains about the need to update a creaky computer system. The dark lining on the silver cloud of having had an early strong computer department at ULL is that Lafayette's networks were developed back in the days of COBOL and significant portions of the city's core network runs in that crusty framework. Slipping in a modern Sun-based but still centrally organized, terminal-heavy system would allow that sort of mainframe-oriented system to move into the modern day relatively painlessly. As the tenders of that system reach retirement age (yes we are that far into the computer age) such a move might become critical.

The Advocate did a stellar job of focusing on the potential interaction of Sun and LUS' fiber to the home project. I recommend you go take a look. It is exciting stuff and doesn't bear much cutting here is a stream the good bits:

Durel said Wednesday that the project’s highest-profile cheerleader reinforced and supplemented the LUS team’s “vision” to not just provide “me too” products with the state-of-the-art network.

“It’s not just about saving customers 20 percent,” Durel said. “It’s much, much bigger than that.”

Durel said McNealy is a big fan of “open source” products, software allows tech-savvy users to upgrade and add their own innovations.

In an open environment, coupled with the vast bandwidth promised by LUS — which has said that traffic inside its network will be unlimited — there’s a great potential for people working out of their garages to develop innovative products in Lafayette, McNealy said.

LUS Director Terry Huval said McNealy talked about the potential for Lafayette schools to utilize curriki.org, which provides free, open source educational materials.

McNealy said Sun Microsystems offers a product called Sun Ray that could also be of great use with LUS’ system to help get more people using technology in their everyday lives.

Sun Ray is a simple, low-cost computer that serves as a conduit between the user and a massive server, where all information, software and processing power is stored.

The interactive display of Sun Ray is merely a way for the user to tap into the network, meaning that any user — with a pass code or swipe card — could use any Sun Ray to access their information, be it at home, work, the library or wirelessly, Huval said.

It's a grand dream and could get most of the city on the network in an extremely exciting and potentially sophisticated way. Serving (free) programs off a server to inexpensive computers is clearly the next step a city could take after offering cheap, universal, big bandwidth. Open source is the way to go and Sun is a leader. Partnering with someone who not ony cares about these ideas is a natural--especially when that partner has already bet the company on the ideas.

As always there are caveats, especially in the context of the digital divide: Sun's terminals are inexpensive--but no longer notably inexpensive in comparison to arguably more capable standalone computers. (And their standalones are more expensive.) The most price-attractive hardware is proprietary and not all open source material is ported to run there. It is a pretty closed ecology without the diversity found in the larger computer market. And it isn't clear what direction will be open to Sun as the mobile market continues to expand.

Without a doubt, it's all exciting and the relationship with Sun will bear watching.

"New" Web Business Models in Lafayette

Food For Thought Dept.

Here's something worth thinking about: Arguably a Lafayette firm is running its business based on what web-folk will tell you is the hottest new cutting edge business model. That firm, as reported by the Advertiser's Bob Moser, is Fugro Chance. Fugro Chance is a survey company specializing in the Gulf of Mexio. It sells its ability to locate things accurately on a map. That is its product. But Chance appears to know that what has really kept in it in business for 30 years is trust: its customers believe that they can trust them to locate things accurately and they trust Chance isn't about to turn their special knowledge into an excuse to rip off their customers. So their customers return...

What got Furgo Chance an admiring piece in the paper is that they gave away their most valuable product, a comprehensive map of the pipelines, old and new, active and inactive, in the Gulf, for free. Apparently no one else has the history and focus to match their expertise and after the storms of '05 ripped up the Gulf offshore platforms an accurate map of the pipelines was crucial to quick, efficient recovery. Everyone from FEMA to 200 industry insiders needed the map. They got it. From the story:

They could have charged thousands of dollars for this map, and most would have paid it. But this mainstay of oil and gas mapping knew what was right, says Marine Data Manager Lionel Cormier. Plus, generosity builds loyalty.

"We e-mailed pdf files (of the map) possibly to 200 people within a few weeks of the hurricanes, it was a handout to the industry," Cormier said. "We felt we were the only one who could produce that map in that timeframe. ... There was more to win than to lose."

That might not strike you as exactly a hot, new, cutting edge business strategy. It might seem remarkably long-sighted in a business climate that trumpets short-term gains and ruthless, immediate, exploitation of every advantage over you customers as a some sort of business virtue leading to "maximizing ROI." You may remember a time when people understood that greed wasn't good business. But this approach to business probably doesn't strike you as new; rather it seems like the "old" model.

But that might be because you're from down the bayou...from a place where shopkeepers used to give away lagniappe in an effort to give "a little extra" in the form of an inexpensive treat for the kids or the customer. That little extra served to prove that the transaction wasn't purely motivated by faceless profit-taking; that the store owner was willing to give a little back in a form that acknowledged the life of the customer.

Not everybody has that, or a similar experience, in their history.

There's a lot of hoo-ha online about "new" business models (for example, Google) that involve giving away valuable products (like maps