PROVO Provo is selling iProvo.
Mayor Lewis Billings announced today the pending sale of the city's fiber-optic network, which provides triple-play service to more than 10,400 city residents, to Broadweave Networks, a local fiber-optic service provider.
The sale price: $40.6 million.
The announcement was part of Billings' presentation of the proposed city budget for the 2009 fiscal year. The audience gathered at the Covey Center for the Arts applauded loudly as Billings announced the proposed transaction.
Billings said the city sent out requests for proposals from organizations interested in taking over the network in April 2007.
Under the terms of the deal, Billings said, the city will retain a license to use the network to connect city buildings, schools and power infrastructure. Broadweave will operate as both the network owner and the service provider.
"This proposed transaction fulfills the long-term vision we have had for this project," Billings said.
The deal needs to be approved by Provo's City Council, but council members at the meeting expressed elation. "Hallelujah," council member Steve Turley said. "The grey clouds have parted and the angels are singing."
Council members Cynthia Dayton and Midge Johnson also expressed excitement about the announcement.
"Two thumbs up," Dayton said.
Royce Van Tassel, spokesman for the Utah Taxpayers Association, said Billings should be commended for his courage to realize telecommunications shouldn't be handled by a city.
Previously, the city's fiber-optic telecommunication network had fallen far below subscriber projections for 2007 only an average of 16 added per week instead the expected 60 and was on track to cost the city $2 million in 2008, adding more red ink to years of poor performance.
Along with the proposed $40.6 million price tag, Billings said Broadweave will also assume the bonds and financial obligations of to the network. Pending City Council approval, the transaction should be completed by June 30.
"We believe this is a good deal," Billings said. "A good deal for Provo and a good deal for Broadweave."Broadweave's board of directors includes Fraser Bullock, former CEO of the 2002 Winter Olympic Games in Salt Lake City and Robert Frankenberg, former head of Novell.