As promised, Macquarie Group has released the details of its proposed public-private partnership (PPP) with UTOPIA, an interlocal agency providing gigabit Internet service in 11 member cities. The deal will require a fee of $18-20 per household to be paid by the cities, but that will be offset from retaining all network revenues. The current estimates show that the fee would effectively be cut in half on the low end and almost entirely eliminated on the high end.
Regardless of the income, each of the participating cities will receive ubiquitous network coverage in their cities and free 3Mbps symmetrical Internet service to every address. Subscribers will also be able to purchase services up to 1Gbps. The 30-year deal will return control of the completed network to the cities who would then receive an estimated $100M in annual revenues from it. During the contract term, Macquarie will handle all operational costs, marketing, and expansion of the network.
Macquarie already has stated its intention to roll out services to the rest of the state, and they’re offering fairly attractive terms to do so. Cities without the existing UTOPIA bond debt may be able to produce revenues like Spanish Fork has done with SFCN. When Google wants to get all kinds of special treatment to roll out their fiber product, you have to wonder why any city wouldn’t pass them up.
Macquarie will be holding open house events at Layton City Hall tonight, April 30, and at West Valley City Hall tomorrow, May 1, at 7PM to answer questions about the proposed deal.