April 30, 2020

Utopia Fiber’s Open Access Fiber Broadband Network

The following transcript has been edited for length and readability. Listen to the entire discussion here on The Broadband Bunch

Hello and welcome again to another episode of the Broadband Bunch. Today, we speak with Kim McKinley, Chief Marketing Officer of Utopia Fiber. Kim provides a background on Utopia, one of the earliest open access networks in North America. We spend some time digging into the impact of the COVID crisis on their network and their partners’ networks, as well as getting into understanding the impact of customer service support, field service, and network issues. We spend time also talking about how municipalities and network operators can be thinking about this as an opportunity to build future-ready networks.

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Pete:

It’s the middle of this COVID crisis and everybody’s dealing with craziness so I really appreciate you taking some time out to help us understand things that you’re going through, what’s working, what you at Utopia are seeing.

Kim:

I think we are at a point where we are busier than we ever have been in Utopia’s history and so it has been a really interesting experience to go through this COVID-19 crisis and really see the importance of broadband that is happening right now throughout the country.

Pete:

We’re going to dig into that, but Utopia’s a unique organization – help everybody understand the context from what you’re seeing in the broadband world.

Utopia Fiber – From the Beginning an Open Access Broadband Network

Kim:

To give you some background on Utopia Fiber, the concept started in 2002, and we went into our first build and customers came up in 2004. We’ve been around for almost 16 years from a customer standpoint, but Utopia is actually an open access network located here in Utah. We have Fiber-to-the-Home right now in 14 Utah cities and we have business class services in over 50 Utah cities and we’re also an operational partner with the Idaho Falls Fiber network. Today, we have about 30,000 customers and we are growing at a rapid rate.  We have about 30 different service providers on our network as well.

Pete:

Sixteen years ago, open access was a new concept in North America. It faded away and it has a different interpretation in Europe, but it seems like it’s coming back in vogue, as an option for North America. That was part of why we wanted to reach out to you, to get a better understanding of the model and some of the lessons that you’ve learned along the way. I know it’s been an interesting journey over those 15 – 16 years.

Kim:

At Utopia, we are an open access network because we fundamentally believe this is the way that broadband should be deployed.  But in Utah we are actually legally prohibited – any municipality – is legally prohibited to offer retail services.  We are forced into this model even if we didn’t believe that this was the correct way to go. But we believe that internet and broadband is infrastructure and that cities should provide this for their entire communities and then let private sector service providers run along those lines.

Pete:

That’s an important distinction. There are some States where there is legislation that prevents folks from delivering retail services and requires separating wholesale and retail services.  The back-end flow of funding and interest in this marketplace, post COVID-19, leads to the concern of overbuilding and a kind of “fight to the bottom”.  It leads to commoditization and helps us understand shared infrastructure, shared resources and partnerships. It hasn’t always been a good model in North America, but getting people to learn that it’s the only sustainable way for us to build out this really critical infrastructure moving forward.

Kim:

That’s what we believe and that’s what our cities believe. They believe you dig once and you let private sector service providers run on those lines. Does that always happen? No, not necessarily. They still struggle in some of the cities where Utopia is, where we do have infrastructure, that the private big telcos come in after and build on top of us. The big telcos in our area have elected not to join the Utopia network thus far, but there is always an open invitation for them to [join] because we would love to have them as part of our network.

Pete:

They have their own separate parallel infrastructure that they have to bear the weight of. You gave us some quick background on Utopia’s journey and you mentioned the growth rate between here and there.  Recently you have seen, like a lot of other network operators, some amazing demand. Maybe you can help us understand the level of demand that you’re seeing as a result of this COVID crisis.

Rapidly Escalating Demand for Reliable, High-Speed Fiber Broadband Access

Kim:

To put into perspective, Utopia was growing at its fastest pace in its history. In 2019, we did close to 6,000 sales for Fiber-To-The-Home and then we started off 2020 very strong. February was our best month in the company’s history at approximately 650 sales and what we’re seeing in March is about a 40% or more increase from that.  I haven’t seen the final numbers and we’re at about 1,100 subscriptions. When people were told to telecommute here in Utah, the amount of phone calls that we started receiving with people saying, “I need better and more reliable connectivity because I’m going to have to do all this video conferencing. I’m going to have to do this.” It’s been a little bit insane to try to fulfill all these requests amongst the pandemic. It comes with its challenges but we are fulfilling the demands as fast as we can.

Pete:

That’s a great testament, that folks are realizing that they’re not going to have enterprise quality connectivity at home, look to Utopia to provide that. That’s not an option in a lot of America. That’s a great credit to the network that you have built out, which has been forward looking. And the other part, you have these new subscribers, new customers coming in, but you have 30,000 existing customers so what’s the support pressure look like from those folks?

Kim:

We’re seeing a lot of requests. One of the big upticks that we’re seeing is people upgrading to a gig or higher. Our base product from our ISPs is 250 Meg, and it’s 250 megs symmetrical, but we’re seeing a huge demand for people who are moving up to a gig. The way the Utopia network is architected is that we don’t have a problem with upgrading all of these folks to meet the demand. We build our networks that are very future-proof and really forward thinking and so we are lucky in that we are not seeing some of the struggles that other networks are having in doing a lot of these upgrades and installations.

Remote Fiber Broadband Customer Service – “Do Not Push the On/Off Button!”

Pete:

What about the call centers and the customer support? It seems like we’d have to rethink how those have been designed in the past.

Kim:

I am over the customer service team as well. All of the customer service team is working remotely right now and picking up their calls remotely and doing everything virtual, which I think is a testament to that Utopia was prepared for this.  We’re seeing a lot of people calling in. One of the issues that we are experiencing is now everybody thinks that they suddenly know how to do router and ONT support. One of the biggest things is people are either pressing the reset button on their ONT or the router companies are telling people to push those reset buttons because they are not used to fiber networks. They’re used to the rest of the world who if you push reset on their equipment. It just turns it off and on again. On our equipment, it changes the whole network configuration a little bit on the device. It’s been interesting. You will see a lot of times on our social media, “Here’s your ONT. Please don’t push this button.”

Pete:

Are you able to reconfigure that remotely or do you have to send somebody out there to fix all those?

Kim:

We do most of it remotely. What gets a little tricky is once people start messing with the fiber, the direct fiber connection into their ONT.

Kim:

It is funny. I mean to listen to some of the calls and people will be like, “it just popped off the wall and I don’t know…” Utah actually had a decent earthquake about a couple of weeks ago, amongst this COVID 19 crisis, so some of that might’ve happened. But for the most part, we don’t see ONTs just falling spontaneously off the wall.

Forward Thinking Fiber Broadband Capacity and Capability

Pete:

Let’s talk about the consumer expectation of getting the same kind of capacity and capability at home that they would at work. They’re all trying to figure out how to work at home and they have kids doing video plus online learning and they’ve got VPNs, multiple VPNs going on. So they’re overloading the system. What are some of the things that they’re seeing and what are some of the root causes that you think that they may be uncovering with this increasing capacity?

Kim:

From our standpoint, we’re not really seeing anybody having issues with those kinds of things. We are hearing from people who are on other providers, who can’t get Utopia, that there is, (and I’ve experienced this when I’m doing conference calls with people across the country) a lot of over-subscription on the other networks.  They were gaming the system to say that we would never see the demand that we’re seeing, and so it’s dropping calls.  Going back to the foresight and the visionaries that started this concept, it’s really paying off because we aren’t seeing those issues of people dropping or the conference calls dropping or their video chats pixelating.

Kim:

We are an essential function that people need right now and the way we’ve done it, it’s really paying off.  I’ve been working at Utopia for 10 plus years at this point and to see what these cities and people went through when they came out with this concept… I would hear it when I would wear my Utopia gear out on the streets, people would say, “You will never need this kind of connectivity. This is dumb. Why are you doing this? I can do exactly what I need to do on the 10 Meg connection.”  Too see how the paradigm shift has happened where people are now saying, “I need a gig. I need the 10 gig connection.”

Pete:

Some of the conversations that we’ve been having is that the industry has been pushing and promoting from a consumer side, technology innovation.  It just seems like innovation for the sake of innovation.  They’re also trying to sell smart cities and work from home and all these ideas that sounded really interesting, but most people couldn’t tangibly understand them.  Now there’s this compelling event of people not wanting to take their kids into the doctor’s office because they don’t want to expose them. So how do I tell if my kid’s sick through my iPhone, or how do I do get a tele diagnosis that way or how do they learn online. Now the pull and push of the demand around that conversation is lined up and people are finally saying, let’s stop talking about if and start talking about how.

From Broadband Dreams to Broadband Realities – Teleworking, Telemedicine & Remote Learning 

Kim:

It’s been a huge shift. I’ve worked in this industry and we talk to cities all the time about this – we talk about telecommuting, we talk about smart city applications, and we talk about telehealth.  But I was one of those people who went to my office every day and so I was selling the dream and then I wasn’t living it. It has put into perspective, even for myself, why I do what I do because I’m living it. I did a tele-health appointment yesterday. I’m telecommuting. I haven’t been in the office in two plus weeks. It’s really tangible to people now. The city’s leaders that we’re talking to could see it, but they didn’t see it as a necessity as they do today.

Fiber Broadband, the Digital Ecosystem and Community Economic Development

Pete:

Another thing that it brings in focus is the digital ecosystem or digital economy. That fiber is the lifeblood of our global economy, and those that are prepared will fare much better than those that are not, not just at a community level, but at a business/commercial level as well.

Kim:

I was just talking to my team earlier and talking about e-commerce and how that’s affecting their lives. Since nobody can go out, what are people buying? I thought this was very interesting from one of my team members. She goes, “I shop only at thrift stores and now my thrift stores are online so that I can buy from thrift stores.”  Out of anybody who could be on an eCommerce platform, I wouldn’t have ever  assumed that thrift stores would move towards that because that’s more of a tangible product – you want to feel it and you want to see it. I think that everybody is having to really rethink about how they do business.

Pete:

You talked about some of the visionaries that you’ve worked with from a community perspective and those that have thought through that, about how to plug in those businesses to have a digital infrastructure are better set to have more stable economic development.  Because we’re in the time of crisis, do you just see network operators focusing on the crisis mode or do you see people with their head up and looking downstream to figure out where do we go from here?

Kim:

I think there’s a combination of both. Network operators today, such as ourselves are focusing on making sure we can connect everybody we can and making sure that we are connecting people to their businesses and people and kids to their schools. We’re focusing on that.  But there’s also a big surge of what does this COVID 19 bring to the industry? What does it bring to the municipal space? There’s going to be a huge surge of cities wanting to put this on the forefront of their budgets and thought, but does that happen? As network operators, we have to take this time and look at what can we do and how can we expand, so if this ever happens again, we’re more prepared.

Pete:

In our earlier conversation, we were talking about that it’s certainly an opportunity in front of us while this terrible tragedy happening.  We are working our best to get through it, but the opportunity is for Americans and global citizens to think differently. How do you interpret that as the opportunity that you see in front of us?

Expanding Fiber Broadband Reach to Accommodate the New Business Normal

Kim:

I think that the opportunity is in front of us is to really expand the industry. Before when we’ve talked about, people didn’t feel it. City leaders who are making this decision didn’t feel it. And now that everybody’s experienced it, we have to take the momentum that we’re seeing from this and really push this industry forward to make sure people are not left behind. This crisis has also really put a spotlight on the digital divide and what is happening there, and we have to take this opportunity to really go start communicating the message and leverage what’s happening right now to move it forward as an opportunity to get more and more communities connected.

Kim:

I personally believe that the business world will never ever be the same. I don’t think as many of us are going to be going into the office every day. I think this has changed the way the business landscape of America is going to look. It will be interesting to see the fallout. I think some of the concerns as the opportunity and what’s ahead of us is how does this crisis make an economic impact? So how do companies really… Do cities have the budget to do these projects, and I think that it all depends on how long it lasts and where does this go from here and how bad does it get?

Pete:

I would not stop your statement about businesses not looking the same, just commercial business. I do think one of the things that, the opportunity here is, like we said before, it’s not necessarily the technology that’s been the cause of inertia. It’s really been the culture and training of our teachers, of our doctors. Now they’ve had this fire drill of an exercise to figure out how to operate in this mode and I think cracking that inertia, they’re all going to step back and say, okay, how are you going to go back to college in the fall?

Pete:

How is that going to look, and there’s going to people that have to figure that out. Some people have figured it out. I think that’s the interesting opportunity is forcing it from, as we all know in technology, the hardest part is the adoption, right? Training and adoption, and this is this compelling event saying, Hey, if you want to keep your job, if you want to keep your kid in school and these are the things we’re going to have to think differently. So that’s, I’m eager to see how that plays out. We have a couple of conversations around that coming up.

Kim:

It is interesting because one of the biggest concerns of people who live here in Utah is that we have really bad air pollution in the winter. Some of the worst in the nation because of inversion and as Utah is rapidly expanding as a state, we have a traffic problem and traffic and air pollution are two of the main concerns of the people who live in Utah, and I think I hear all this time, well one of the things is we can get autonomous vehicles to make sure that we’re traveling smarter on the interstate, but then you look at it in this more simplistic approach. Well what if everybody just, what if more people stayed at home and worked? That would solve a lot of those problems and it’s so much more simplistic than these big financial programs that they wanted to implement.

Pete:

Simple changes and we’re definitely going to see that they impact, the healing of the ecosystem or the Earth’s ecosystem as everybody chills out for a few months. It would be really interesting to see what that data looks like. There are huge opportunities ahead of us. There are some short-term crises that we’re dealing with. Any short-term guidance that you’ve seen that’s resonating to help people think through this in the next few weeks, maybe month or so?

Be a Good Neighbor – Give Broadband Access, Keep People Working & Learning

Kim:

I think the short-term guidance is to make sure you’re keeping to your plan. This is what we are doing, is making sure network is top notch to make sure that our reliability and speed is there and to make sure you’re really helping the customers right now and making sure that their connections are as good as possible. One thing that we are recommending, because we know that a lot of people are without internet right now and have a lot of the financial struggles, our CEO, Roger [Timmerman] said, “turn on your wireless router to guest mode, so your neighbors, if they don’t have connectivity, can jump onto your connection”. This can help people out in a simplistic way.

Kim:

Just to do the small term things like we worked with some schools in the state of Utah to help give short term connectivity so people can go to school. Just do whatever you can from a short-term aspect to keep people up and running during this unprecedented time we’re seeing, we’re having.

Pete:

It’s like running the old extension cord through the window to help your neighbor power’s out, which I’ve had the benefactor of that many times. So that’s great, but what about long term? A couple of weeks down the road, things kind of settle in and schools decided to give up and fold up shop for the summer. Where should our brains be going next?

Providing Fiber Broadband Access to All is an Essential Service

Kim:

I think it’s to realize that this is a central infrastructure and that we need to make sure we’re having the conversations and getting out there and figuring out how to get this connectivity through, not just communities. It’s rural communities, it’s urban communities. How do we get there and as a nation, how does this industry come to provide connectivity to the country because we’re all not going to be able to expand our network to the entire country. So we need to work together to make sure that we are hitting as many communities to provide this essential infrastructure as possible.

Pete:

The increased visibility into the digital gap, and that the areas that are going to stand out as really lacking or not really the tier one and the incumbents aren’t going to move to those areas because the balance sheet equation doesn’t change for them. It’s typical. They take rates and what they can make in those markets. So this is a great opportunity for the smaller organizations, the more regional municipalities that can really help go to bat finally and stop thinking about or hoping that someone’s going to solve this problem and say, look, this is a problem we need to solve now. They didn’t have electricity and water, you wouldn’t think twice about it. It’s time to solve this problem once and for all. Now we just got to line up the funding and the knowhow to make sure that we can do it effectively and reliably.

Kim:

We’ve added three additional cities in the past couple of years to the Utopia fiber network. One of them is a community of about 350 homes. Another one is about a community of 1200 homes, and what we’re seeing is going in, first of all, the politicians in those cities look like geniuses right now, but second of all, I’m watching their Facebook accounts and how many of the consumers and residents of those communities are like, thank you to their city officials. Thank you for bringing this infrastructure. I would not be able to do what I’m doing if you hadn’t thought about this, if you hadn’t thought about why our city needed this, and I think those conversations and just seeing that and seeing it from my perspective of how much people are really, they thank their cities for making this investment is huge right now. It’s huge and it’s kind of heartwarming to see that all of our hard work that we’ve been doing here at Utopia fiber for 16 years is really paying off right now.

Pete:

I hope you get the recognition for it because a lot of these efforts are almost patriotic. The folks that are the general managers of these things are just local fellows and ladies that want to help serve their communities and those that have kind of battled to bring in good future thinking networks are making, improving the chances for the community to be safe and viable moving forward, and I think this is new normal. This is going to happen again, right? Something’s going to happen again. So there’s plenty of opportunity for folks to get on board and build the system that their community is going to need, not just in the near term but in the future and hopefully, they learn from what you all are doing in Utah. So Kim, I really appreciate your time. How can people learn more about Utopia and the partners that you work with?

Team Utopia – Learn More

Kim:

You can always go to our website, utopiafiber.com. We are actually doing some major upgrades on our website to put in some more materials, but you can always reach out to us at Utopia, either myself or I can put you in contact with others at Utopia if somebody has questions regarding any aspect of what we do. Utopia’s model and what we believe at, (I call it Team Utopia), is that our mission is to provide connectivity to the state, but also to really help these projects around the country get started.

Kim:

Utopia has had its challenges in the past, but we’ve really had figured out the secret sauce to make these open access networks work and we want to share our knowledge. We want to share it to anybody who needs help. I’ve said it before, if it’s been done wrong once, we’ve probably done it, but we’ve really figured out what makes these things work and what makes them tick and we just really want to see the industry as a whole succeed.

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