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MI-Connection Embraces New Strategies, Increases Speeds for Free

MI-Connection, the North Carolina community-owned network serving Davidson, Cornelius, and Mooresville, is upgrading network speeds and unveiling a new marketing campaign. MI-Connection was formed when a few towns north of Charlotte purchased the old, dilapidated Adelphia cable network out of bankruptcy and began rehabbing it.

According to David Boraks of the DavidsonNews.net:

The company on Dec. 10 will begin selling a new top speed internet service tentatively called “Warp Speed Broadband,” though the name could change. It will offer 60 mbps downloads and 10 mbps uploads. Customers can get it for $80 to $100, depending on whether they bundle it with TV and telephone.

Existing customers also will get faster speeds Dec. 10, at no extra charge (Download speed x upload speed): 8×4 becomes 10×5, 12×4 becomes 15×5, 16×4 becomes 20×5 and 20×4 becomes 30×10.

Notice that this community network offers faster upstream speeds than most privately owned cable networks -- because they recognize the importance of empowering subscribers rather than hoping they will just consumer video and do little else.

The DavidsonNews.net article also covered MI-Connection's last quarter financial audit report. The network has faced chronic financial problems but things continue to improve. From the article:

The financial report for the quarter that ended Sept. 30 showed that the company grew revenues in all three of its businesses – cable TV, telephone and internet. Altogether, revenues were up 6.5 percent from the first quarter a year ago, to $4,114,992. Expenses fell 8.7 percent, in part because of savings on what the company pays its high-speed internet providers.

The company’s earnings from day-to-day operations continued to grow.

A new marketing plan, dubbed "Straight Talk," will appeal to local ownership and include slogans like "If you owned a grocery store, wouldn't you shop there?" "Can you create jobs just by watching TV?" and "When your boss is everyone in town, your customer service had better be good." It will be interesting to see whether or not the appeal to community spirit helps increase subscribership.

North Carolina law is especially hostile to community owned networks and MI-Connection has struggled financially, in large part due to how poorly Adelphia (a private company) had maintained essential components. Competitive attacks from Time Warner Cable have aggravated the situation. StopTheCap reported in April that, in a rare instance of private overbuilding, the cable giant has begun serving the area and appears to be making a competitive grab for MI-Connections customers.

Stop the Cap

The situation has been difficult for MI-Connection but great for all consumers in the region. From the Stop The Cap article:

Other residents in nearby Cornelius are also getting prices substantially lower than residents in cities like Charlotte, where many residents have one choice for cable: Time Warner. 

Sam, a Stop the Cap! reader in the Morrison Plantation neighborhood, noted they skipped the last few rate increases from the cable company.

“You just call and tell them the rate is too high and as soon as they find out you have MI-Connection as an alternative, they lower the price,” he said. “My niece in Charlotte can’t get the same deal even when we gave her the details — it’s only good in areas where MI-Connection operates.”

That leaves Charlotte residents paying $35-50 more a month than savvy customers further north can have for the asking.

Once again we find that competition improves affordability, even in a state with some of the toughest restrictions.

Sam, quoted in the StopTheCap article makes an astute observation about the cable company's agenda:

“It seems pretty clear to me that Time Warner isn’t hurrying to compete with Comcast or Charter — just MI-Connection and that makes me suspicious,” Sam says. “After spending all that money to ban community broadband in the state, they now seem to be trying to drive out of business the handful of companies that were exempted.”

“My niece is probably paying for this right now on her cable bill too, and once MI-Connection is out of the way, those prices will shoot right back up,” Sam concludes.

Leading Critic of Community Network in NC Revealed to Be TWC Employee

It will come as no surprise to those familiar with this space that the leading critic of MI-Connection, a cable network in North Carolina owned by local governments, has been revealed to be an employee of Time Warner Cable. Hat tip to Stop the Cap! for bringing it to our attention last night.

We have long watched massive cable/phone companies flood public meetings (both honestly and surreptitiously) with their employees to give the perception of widespread opposition to a publicly owned network. So while this is nothing new, the practice must be highlighted as something community networks should be aware of -- much like the rampant abuse of the commenting system in the Salisbury Post, where any story that mentions the community fiber network Fibrant is slammed by a few people who post under many different identities to give the impression of widespread disapproval.

MI-Connection has been plagued by problems since buying a system that was in considerably worse shape than expected, thus requiring more capital to rehab and upgrade it. An additional problem has been the image damage done by relentless critics (noted last week):

Venzon [Chairman of Board for MI-Connection] said he’s frustrated because the publicly owned company still fights an image problem.

“With the improvements we made to the system, I thought that people would be lined up out the door,” Venzon said. “I thought they’d see this as ours, this is us, and it just bugs me that we get such poor PR out there. We have not won that battle.

And now we know that a major critic of the network works for Time Warner Cable, a company vociferously opposes muni networks as a threat to their de facto monopoly. It would not be as much of a story though if he hadn't denied his employment with TWC for so long in order for his attacks on the publicly owned network to be more effective.

MI-Connection board chair John Venzon posted the information in a comment on this website Friday. He said Mr. Stevens “has been active in using our publicly available information to turn our potential customers against us and to stir up fear, uncertainty and doubt about MI-Connection while hiding his motives. He does not live in our town or service area, so he does not ‘have a dog in the fight’ unless you consider who signs his paycheck. Could I attend competitors’ regular board meetings to see what they are doing?” Mr. Venzon asked in the comment.

Mr. Venzon also noted that Mr. Stevens has used the state’s open records law, or Freedom of Information Act, to obtain copies of “every communication between the towns, the board and management. So Time Warner does in fact sit in our meetings.”

Under North Carolina Law, those records are open, and the towns have known since they bought the system in 2007 that they had to operate under public scrutiny in a way their private competitors did not. Mr. Venzon acknowledged that, but said he’s unhappy about having a Time Warner employee following the company so closely. “In corporate America, this would constitute espionage. In our situation, it is free and legal. I find it deplorable,” he wrote.

Does it matter that Mr. Stevens is a Time Warner Cable employee? As editor of DavidsonNews.net, it concerns me that Mr. Stevens hasn’t acknowledged his employment when we’ve asked, or when he has commented regularly on this site about MI-Connection.

Stop the Cap! sums it up well:

Indeed, Stevens’ efforts to hide his employer’s identity and his subsequent decision to bring his blog down after the cat was let out of the bag suggests there is nothing for Stevens or Time Warner Cable to be proud of in their relentless, often sneaky efforts to bring community-owned competition to its knees.  When it comes to protecting duopoly profits of local cable and phone companies in North Carolina, it’s total war on all fronts.

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Time Warner Cable may claim that they have no say in what employees do in their spare time, but they keep very close tabs on these networks and absolutely knew that he was leading a fight against another community's network while lying about his motives and employment. TWC regularly labelled MI-Connection a "failure" in its efforts to pass a bill that would preempt local authority to invest in networks that could compete with TWC services.

This entire fiasco serves as a reminder of the massive disadvantages communities have in building their own networks. Companies like Time Warner Cable, which measure their revenue in the tens of billions, have effectively unlimited resources to attack communities who build their own networks. Big companies attack communities in the courts, legislatures, and the media -- while communities have little power to respond in any of those venues (communities don't have the funds to fight in the Legislature or the media and struggle to justify expensive, prolonged court fights). This is the reality in every state.

And in places like North Carolina, it could get a lot worse if the Governor allows h 129 to become law. It is on her desk now and whether she signs it or lets it pass by doing nothing, big companies like Time Warner Cable will have even more advantages while communities will effectively be barred from building their own networks.

Proactive Broadband Communities and NATOA Awards

Craig Settles recently wrote "Debunking Myths about Government-Run Broadband" to defend publicly owned networks (the title is unfortunate as many networks are publicly owned but not necessarily run directly by the government). Nonetheless, he tackles several false claims commonly levied against public networks and offers an entertaining rebuff to those rascally incumbents down in North Carolina that keep trying to buy legislation to protect themselves from competition:

Time Warner tried to get a bill passed in the state legislature this year to prevent cities from offering broadband service. They claimed community networks create an un-fair playing field. Personally, if I ran a bezillion dollar company and a small town of 48,000 with no prior technology business expertise built a network 10 times faster than my best offering, I’d be embarrassed to be associated with the bill. If incumbents want to level the playing field, maybe they should outsource their engineering operations to Wilson.

He revealed an upcoming list of ten smart broadband communities that has since been published here. This is a mixture of communities that have taken action to improve broadband - a variety of models and community types.

Without detracting from this list, I want to note that some networks are missing important context. For instance, Wilson NC, lists an unimpressive number of subscribers currently, but the network is still being built and many who want to subscribe are not yet able to subscribe. Additionally, it would be nice to see the prices offered for each speed tier -- many of these networks keep higher speed tiers much more affordable than do traditional carriers. That said, many kudos to Craig for putting this list out there (he will be putting similar lists up in the near future).

While on the subject of impressive community networks, NATOA has announced its community broadband awards. I am excited to see the city of Monticello recognized for its courage in responding to shady incumbent-led attacks and frivolous lawsuits -- primarily by TDS -- attempting to deny the community the right to build its own network.

Though the other award recipients are also excellent, I want to congratulation MI-Connection for their award of Community Broadband Project of the Year. Years ago, I wrote an op-ed in favor of that network and I am glad to see it succeeding.

MI-Connection was born after the demise of Adelphia Cable. Local towns bought the system and rehabilitated it, offering a publicly owned local alternative for broadband and cable.

Image Credit: Domen Colja - Fotolia.com