[1st-mile-nm] Rio Rancho Terminates Wireless Contract

[Richard Lowenberg]

Tuesday, September 25, 2007

RR Terminates Wireless Contract

By Rosalie Rayburn
Albuquerque Journal Staff Writer

Rio Rancho's ambitious free wireless Internet project is officially dead.

    City contracts administrator Steve Ruger sent a letter to Azulstar
president Tony van Houwelingen late last week immediately terminating the
wireless company's contract with Rio Rancho.
    The letter, dated Sept. 20, said the wireless company failed to honor
terms of the contract regarding payment for electricity charges, providing
a satisfactory business plan and proof of its financial ability to offer
continued service in the city of Rio Rancho.

    "The city does not see a continued relationship with Azulstar as in
its best interest," the letter said.

    Grand Haven, Mich.-based Azulstar signed a contract with the city in
2004 to operate a wireless network on city property and rights of way. In
return, Azulstar was supposed to provide eight free hours of Internet
service per month for residents of Rio Rancho.
    The letter said Azulstar was in breach of contract because it owes the
city $33,000 for electricity charges.

    Under the terms of the contract, Public Service Company of New Mexico
billed the city for electricity Azulstar used to run its wireless network.
Azulstar was, in turn, supposed to reimburse the city, Ruger said.
    The city sent Azulstar an invoice on July 27 for electricity charges
dating back to 2005, when the company began operating its network.

    Ruger said Azulstar did not respond and has continued to incur
electricity charges at the rate of about $1,600 per month.
    Reached by telephone on Monday, Houwelingen told the Journal he needed
to consult with the company's primary owners in New Mexico before he could
comment.
    Ruger said he sent the letter to Houwelingen because his name was on
official communications the city received from Azulstar.

    City officials have been pressuring Azulstar since early May to get
the wireless company to address complaints about poor service and lack of
customer support.

    In early July, city officials threatened to terminate Azulstar's
contract within 40 days unless the company provided a plan showing how it
would improve service.
    In mid-August, Azulstar submitted a plan to revamp its network and
billing procedures. Azulstar also said it would arrange to be billed
directly by PNM.
    The city spent nearly a month reviewing Azulstar's plan before it sent
the letter terminating the contract. The letter notified Azulstar that it
has until Dec. 31 to remove all its equipment from city facilities. After
that, the city will remove any remaining equipment and invoice Azulstar
for any associated costs.

    The city currently has no plans to seek another wireless provider,
Ruger said.


------------------------------------------------
Richard Lowenberg
P.O.Box 8001, Santa Fe, NM 87504
505-989-9110,  505-603-5200 cell

New Mexico Broadband Initiative
www.1st-mile.com/newmexico
------------------------------------------------