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PC Telcom strategic planning goals discussed at annual meeting PDF Print E-mail
Written by Chris Lee   

Despite a year where PC Telcom experienced an operating loss, board members and staff are excited for what the future has to offer.

Members of PC Telcom met Thursday, April 7 for their annual meeting at HHS to see what progress has been made over the last year and see what is in store for the next year of business.

A short video outlining current trends in technology and where the United States stands compared to other countries got the members thinking about just how many different things are happening with today’s technology and what PC Telcom is doing to keep up with the changing times.

Company CEO/General Manager Vince Kropp reviewed projects and activities from 2010 and outlined the upcoming year.

In order to prepare for the technological, legislative and regulatory changes that have been unfolding over the last decade, PC Telcom has undertaken a formal strategic planning process annually for approximately the last 10 years, Kropp said. The process has allowed them to prepare for the shift from voice land line services to broadband services.

Kropp outlined seven goals that came from the planning session. They are as follows:

—Improve the quality of products/services beyond existing local exchange (telephone) footprint.

—Develop and expand the IT consulting role and function.

—Aggressively expand the education and training of customers, board members and employees.

—Significantly expand broadband services.

—Explore opportunities for participation in Smart Grid/Home Services.

—Continue to evaluate mobility options/opportunities.

—Maintain profitability and sustainability.

Planning sessions allowed PC Telcom to plan for the future and begin the process of installing fiber optics for pent up broadband needs a couple years ago, Kropp said.

“Primarily due to a two-year lag in our cost-recovery process, we anticipated a couple of years where cash flows would be challenged, but once we get through these couple of challenging years, we will have state of the art facilities that are capable of providing the broadband services that will be necessary in order for PC Telcom to remain competitive,” he added.

On the telephone side of the business, the ongoing replacement of outdated copper cable with fiber optic cable continued. “These upgrades provide us additional capacity where our copper plant has outlived its useful life,” Kropp said.

PC Telcom is one of the founding members of Colorado Communications Transport (CCT), a newly formed Limited Liability Company that is formed primarily by a group of companies similar to PC Telcom with common goals.

Kropp said in PC Telcom’s case, they now have virtual connectivity to Denver, which will give them many more options for connecting to interexchange carriers such as AT&T, Verizon and others.

Last fall, PC Telcom increased base internet speeds from 768 Kbps to 1.0 Mbps. With access to higher speeds at affordable rates via the CCT connection, PC Telcom intends to increase base internet connection speeds again in the coming months, according to Kropp.

 

FCC Broadband Plan outlined

Kropp also discussed details surrounding the Federal Communication Commission’s Broadband Plan which was released just over a year ago.

Some of the long-term goals within the plan include:

—At least 100 million homes should have affordable access to download speeds of 100 Mbps.

—The U.S. should lead the world in mobile innovation.

—Every American should have affordable access to robust broadband service.

—Every American community should have access to at least 1 Gbps broadband service to anchor institutions.

—Every first responder should have access to a nationwide, wireless, interoperable broadband public safety network.

—Every American should be able to track and manage their real-time energy consumption—presumably through the previously mentioned Smart Grid.

“PC Telcom is well on its way to accomplish most of the goals within the FCC’s plan for Holyoke and the surrounding communities that we serve,” Kropp said. He noted the two wireless goals within the plan are a bit more challenging for a small carrier like PC Telcom, but they continue to evaluate options to deliver such a service.

One of the areas for concern within the plan as it has evolved is that it maintains a goal of 100 Mbps to 100 million homes, however, they have lowered the goal for rural portions of the country to 4 Mbps, according to Kropp. He said this is a huge disparity between the goal for urban customers and rural.

“This is quite disappointing because it will represent a major step backwards from the telecommunications policy the U.S. has held for nearly a century,” Kropp said.

 

Financial report given

Board president Rick Krueger walked members through the financial report for 2010.

Total current assets dropped $1.3 million from 2009 to $1,865,885 in 2010. Krueger noted the decrease can be linked to the significant upgrades the company has done with regard to the fiber optics.

Non-current assets increased $41,474 from 2009 to $148,830 in 2010.

PC Telcom saw a net loss of $502,046. Krueger noted a net loss is never the intention of a company, but this loss was anticipated due to the investment in the fiber network installation.

“We certainly never aim to have an operating loss, however, we realized that in order to undertake the upgrades that have proven to be necessary in order to provide quality broadband services that we would experience a couple of tough years,” Kropp said. “2010 was one of those years.”

A question concerning the near $3 million earned as a result of the Platte River Cellular sale was posed. The member wanted to know where the money was located in the financial report. Krueger said the money was located within members equity. It was then asked why members equity had decreased from the previous year if money had been added to it.

Kropp said depreciation played a big role as PC Telcom adjusted depreciation rates last year. He also noted the sale took place in January of 2009.

Kropp said the Colorado regulatory environment is notoriously tough for small providers and depreciation rates were typically set within the confines of a rate case so PC Telcom’s depreciation rates have been unrealistically low.

“Depreciation rates were adjusted last year to bring them more in line with current equipment life cycles,” he added.

 

Krueger re-elected

PC Telcom members reelected Krueger to the board of directors. There was only one seat open this year.

Mountain Railroad of Haxtun provided the evening’s entertainment. Band members include Joe Bivins, Staci Tempel and Keith Hudiburgh.

Prior to the business meeting, members enjoyed a catered meal. Members also had the chance to win a variety of door prizes given away in a drawing at the conclusion of the meeting.