2.24.2010

Burlington Telecom: There are no heroes in this story

Where is my John Wayne?
Where is my prairie son?
Where is my happy ending?
Where have all the cowboys gone?

-- Where have all the cowboys gone?, Paula Cole

American mythology is full of stories of lone heroes who ride into town to save the day (see Eastwood, Clint for example). The ongoing saga of Burlington Telecom, however, is a story without a happy ending, and unfortunately no band of heroes is going to appear and save the day.

Burlington Telecom is now technically in default and can't pay its debt service (details here). Something has got to give at some point, BT has been constrained from access to additional public monies, and given that it needs cash, options are limited.

Bankruptcy looms, and the role of the City of Burlington as a guarantor of BT's debt will keep lawyers lawyering (and billing) for a good long time. Also, there is a criminal investigation into how city employees used public monies to finance BT and where the monies went. BT threatens to become the fiber optic network that ate Burlington, or at least destroys the city's credit rating.

Into this morass, a group of experts has come forward and offered to save the day. As reported in the news site VTdigger.org (full story here):

A group of telecommunication professionals have offered to bail out Burlington Telecom in exchange for management control of the nonprofit utility. The “team” of nine men, who represent tech, legal and energy firms, sent a detailed proposal to the City of Burlington on Feb. 17. The three-point plan would provide a “safety net” for Burlington Telecom in the event that the city is unable to shore up the utility on its own.

....

Under the proposal, as outlined by Andy Montroll, former president of the Burlington City Council, the city would cede management and control of Burlington Telecom to the nine-person team, which would be responsible for stabilizing the operation and for preventing “further immediate erosion and lay the ground work for a sustained recovery.” The team includes Tim Nulty, the former general manager of Burlington Telecom and the director of ECFiber....

And, in Seven Days, this nugget from the aforementioned Mr. Nulty:

“I have a great deal of blood, sweat and tears in BT, and I hate to see it trashed and destroyed by incompetence and misbehavior” ... “It's also damaging the reputation of other municipal fiber networks around the country.”

Now, for the sake of simplicity, and because I have better things to do than to write thousands of words on this tired situation -- though I think that it would be quite easy, to get an entire Master's thesis-length document, out of the genesis, life and slow death of Burlington Telecom, I will try and get the heart of the matter. There are two ways of looking at the situation:

1) Burlington Telecom was a good idea and its present failure is the result of the incompetence, malfeasance, and machinations of the current regime in Burlington City Hall and the existing BT management team. This cast of characters is a group that could be fairly characterized as 'the gang that couldn't shoot straight.'

So, has BT been 'trashed' by incompetence and misbehavior'?

or, scenario #2

2) Burlington Telecom was doomed right from the start, it was a fundamentally flawed concept that would never work financially, regardless of the competence (or lack thereof) of local management and municipal government.

Myself, I lean towards #2: Burlington Telecom was doomed when the ill-informed citizens of Burlington voted to approve the idea. While it is technically feasible to build a fiber-to-the-home network in Burlington, it has proven to be very expensive (and the need for more capital basically never ends) and the financial business case for the project never made sense. The numbers didn't add up then, they don't add up now, and it's hard to imagine that this can be resolved.

Let me be clear: I think that the current management team at Burlington Telecom is incompetent and has not faced reality -- the current General Manager has made some absolutely jaw-dropping public statements, considering the fact that he is running a bankrupt company. Similarly, Mayor Bob Kiss seems to live in denial about the reality of the situation.

I hope that a well-informed, engaged and highly motivated electorate turns out on election day in large numbers and turns out the current mayor and his allies on the city council -- I even can indulge in Utopian fantasies on occasion.

But, as noted above, I don't think that Burlington Telecom's problems began with the Kiss administration -- the problems started in the late 1990's when the idea was originally conceived. And, frankly, as Mr. Nulty is one of the enthusiasts originally behind this scheme, I would view this offer of a rescue with considerable doubt and suspicion.

BT is a story without heroes or redemption and will probably end with the network being sold off for pennies on the dollar. Was this a good use of scarce municipal resources? I think not.

I know that this blog post misses a lot of nuance -- there are a lot of issues that could be addressed. I have also noticed that the while the media is adequate at covering what's happening -- there is not much analysis as to why things are happening. But I'm also tired of reading about the situation and am ready to move on.

Perhaps I'll write some amateur analysis on the Vermont Public Service board's activities (BT, Fairpoint, Entergy, etc.), who knew that these topics could be so lively and engaging.

This recent post contains links to all posts I have written on BT so far.

2.21.2010

2010: Random Photo Content #5: The 2007 Valentine's Day blizzard

A follow-up to the previous post, there have been no scenes like this here in this winter season. Around New Years there was probably a little more than a foot of snow on the ground... but the snowpack has been diminishing little by little ever since.

The 2007 blizzard was a major storm that dumped more than two feet of snow, accompanied by high winds and bitter cold temperatures. This was in the morning as things as the snow started to fall heavily.

By 9 pm, the front yard was completely drifted in as temperatures hovered around zero.

For my part, if I don't have to travel, I don't mind big storms with lots of snow. I would rather have good snow cover to ski on than live through a succession of dry, cold cheerless winter days. Perhaps next year...

More photos of 2007 blizzard here.

2.18.2010

2010: A Vermont winter with little snow

It's been a wild winter -- but only hundreds of miles south of where I live in Central Vermont. All the blizzards that have snarled travel and buried the mid-Atlantic states have slid by with nary a flury in the Vermont mountains.

It's mid-February and the sun is higher in the sky and bare patches are starting to appear on southern exposures. The snow cover was never very deep to begin and it won't take much for the snow to disappear.

A red-winged blackbird -- perhaps a refugee from southern blizzards, seeking the quieter, more clement weather of the far north -- forages in a bare patch of grass outside my condo.

March can be stormy so there still may be a significant snowfall in the future but it's safe to say that the 2009-2010 season will turn out to be a quite undistinguished year for snow.

2.12.2010

Enjoy the silence

Everywhere I look, I see problems. Difficult problems. Discouraging, complex, hard to solve problems, and on every scale: Local, statewide, national, etc.

And yet, it seems that an awful lot of energy is devoted these days to developing tools that allow individuals to share little bits of themselves online with others. This week Google rolled out "Google Buzz", a tool to add twitter- and Facebook-like features to its gmail product.

I find, however, that I'm really not interested in more 'conversations'. I find that the connections with my various online contacts are mostly weak and tenuous at best unless they are grounded in real-world interaction of some sort. The constant status updates and bits of information are more distracting than illuminating and serve to cut one off from tactile experiences in the real world and interactions with real live people.

Foursquare: A twitter tool enabling narcissism and triviality.

Consequently I just turned the "Buzz" feature off in my Google account. Google is an advertising delivery mechanism and the company is already aggregating vast amounts of information about my online activities so it doesn't need to gather any more, enough already.

2.11.2010

2010: Random Photo Content #4: Sunrise at Daytona Beach

Dayton Beach, Florida, February 2008. It's February in Vermont, the sun is rising higher in the sky, the days are getting noticeably longer, and the big snows down south keep missing us. But spring still seems a long time away.

2.07.2010

Burlington Telecom: Tides of grim foreboding, moving to fulfillment

My own eyes tell me
Agamemnon has returned.
For that I need no further witness.
But still, here, deep in my heart,
the spontaneous song
keeps up its tuneless dirge,
as the avenging Furies chant.
It kills my confidence, my hope.
Everything inside me
beats against my chest,
surging back and forth
in tides of grim foreboding—
something's moving to fulfillment.
Speech of Cassandra, from Aeschylus, Agememnon, 458 BC.

"Tides of grim foreboding — something's moving to fulfillment" -- truer and more apt words were never spoken. The City of Burlington's attempt at building a municipal communications network, Burlington Telecom, which I would characterize as a 'bad idea, disastrously implemented', now faces its day of financial reckoning.

There are a variety of possible outcomes from this situation, but nothing is certain, except that it seems very likely, that someone (or some entity) is going to take some kind of haircut on this transaction. Burlington taxpayers, this likely means you...

All I have to say on this tired subject at this point in time is "Don't say I didn't warn you." I wrote a blog post in May 2008 were I pointed out that Burlington Telecom had too few customers and way too much debt and seemed unsustainable -- long before the current crisis bubbled up and drew the belated attention of the Burlington City Council, the media (props to John Briggs at the Burlington Free Press for illuminating coverage of BT), and various bloggers.

I spent the latter part of the giddy, frothy, bubbly (it seems so long ago) 1990s working for a Burlington-based Internet service provider. This company was eventually acquired -- through an exercise in the kind of misbegotten financial engineering that presently characterizes the American economy -- by a doomed holding company known as OneMain.com. Much like Burlington Telecom, OneMain.com had a business plan shot through with extravagant examples of wishful thinking and then managed to burn cash at a remarkable rate.

My long suspicion of, and aversion to, the concept of Burlington Telecom is rooted in these experiences and is far more practical than rooted in ideology. I'm not at all surprised at how things have played out: I always thought the project would be too expensive, and that the managerial talent would not exist within Burlington City Government to pull it off successfully.

Here are links to my prior posts on this subject:

2.06.2010

First ride of the new year

While blizzards hit the mid-Atlantic states hundreds of miles south of here and while even Burlington (just 25 miles away) had its snowiest January ever... where I live it has been pretty much just dry and cold.

Central Vermont is in a 'snow drought' and while the weather pattern is good for ice fishermen and pond hockey players... it's not particularly good for skiing.

The Redline parked in a snowbank.

So today I shook off the computer-induced torpor and ventured forth on my battered Redline. It was quite cold (less than 20 deg F) and there was a good brisk west wind blowing but it was good to get out of the house for a while. Unfortunately I could not find my shoe covers which meant that I did a short but vivid little pain dance as my feet thawed when I returned home after a little more than an hour of tooling around on the bike.

Looking west down the valley of the Winooski River.