Five companies express interest in Click! Network

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Five companies are interested in a long-term partnership with Click! Network. Two already do business with Click!, another is a previous suitor under new ownership, with a new American company and an established European company rounding out the list.

In March the city issued a request for information and qualifications to solicit input from entities with an interest in developing a partnership with Click! It reflected 12 policy goals developed by Tacoma City Council and Tacoma Public Utility Board. These covered the areas of: municipal ownership; equity; affordability; net neutrality; open access; preserving competition; safeguarding public sector use; maintaining financial stability; promoting economic development and education; job security and intellectual capital; protecting customer privacy and goodwill/customer service.

Respondents were asked how they would meet the policy goals. They were also asked to recognize challenges for Click!, as well the city’s vision for it, and to show the financial ability to invest in network upgrades.

The city contracted with consulting firm CTC Technology & Energy, based in Kensington, Md., to review responses and make recommendations. Joanne Hovis, president and director of business consulting with the firm, made a presentation to the council and board on May 22.

Hovis said while the responses have differences, taken together they prove significant market interest in the operation.

Two are local businesses that already offer Internet service through Click!; Advanced Stream and Rainier Connect. Advanced Stream did not fully address the underlying financial challenges of the network. Hovis said the company would like TPU to change budget allocations so ratepayers cover more of the costs.

Hovis said her concern with the response from Rainier Connect is it does not properly address financial risks and obligations. The company wants to lease the network and provide service, while TPU would hold all risks and fund upgrades.

Wyyerd is a new company with executives with experience with companies such as Zayo and Level3, both substantial providers of infrastructure and services nationally. Hovis said she normally would be concerned about a start-up company attempting such an ambitious endeavor, but not in this case due to Wyyerd’s leadership and financial backing. “I take it quite seriously.”

She said Wyyerd indicated an interest in purchasing Click!, which is against the terms laid out in the request. Hovis said Wyyerd showed interest in many of the 12 policies, such as hiring displaced Click! employees, although its privacy policy may not be as strong as the City wants.

Yomura Fiber is based in the United Kingdom and Sweden. It operates in many European markets. The company stated it will fund upgrades of Click!’s coaxial plant to fiber-to-the-premises and after the lease period, the fiber would be owned and controlled by TPU. The company proposes to provide a free tier of service to low-income customers. The response was strong in adherence to net neutrality and privacy principles.

A concern with Yomura is the company is not well known in America, although it stated in the response it has projects underway in Denver, Atlanta and Charlotte. “They are interested in significant growth in the United States,” Hovis observed.

Wave’s ownership and management has changed since TPU considered a proposal from the company to acquire the network two years ago. It has been acquired by private equity firm TPG Capital. It recently acquired RCN Communications on the East Coast and Grande Communications in Texas. It is now one of the major cable companies in the United States, a competitor to Comcast and AT&T.

Wave operates in Washington, Oregon and California. Hovis said it is in expansion mode. It would like a long-term right of use.

Board member Bryan Flint said he liked the fact that five companies responded to an open process, which he prefers to the prior process to negotiate with Wave. “It sounds like we have something to work with.”

Hovis recommended thorough discussions with the five respondents. “There is a basis here for further action.”

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