Danny Williams made his reputation by taking a cable television company, adding on a bunch of telecommunications assets and then flipping the thing for cash and stocks.
The company Danny owned was Cable Atlantic, formerly Avalon Cablevision. Danny was the majority owner, but small pieces were owned by Dean Macdonald and Ken Marshall.
1. The easiest thing to point out about Thursday's news release on government's suddenly discovered "telecommunications strategy" is that the key players in the deal are the provincial government, Persona and Rogers, headed respectively by:
- Danny Williams;
- Dean MacDonald; and,
- Ken Marshall.
2. The next easiest thing to notice is that the fibreoptic lines are to run along the TransCanada highway and along the south coast. There is nothing in this announcement to include Labrador.
3. The next easiest thing to note is that while this is supposed to be a private sector venture, the provincial government as the largest or second largest shareholder. Dannystan winds up with 28.8% of the investment in this project, while the three private sector companies are ponying up a total of $37 million. According to an earlier news story Persona was dropping in $30 million on its own. However since the original proposal was for an $82 million job and the total announced Thursday was $52 million, we have to wonder what the portions wind up being.
4. The next easiest thing to wonder is how the government shares are going to be held. Will they be held by say, the Department of Finance or Trevor Taylor's innovation crowd? Or will they be handed over to Hydro under its new mandate?
5. The next easiest thing to wonder is what Newfoundland and Labrador will earn for its financial interest. Use of these fibreoptic cables has a cost attached to it. If government is investing in the construction then it should also be getting a piece of the action. Every time you sign up for any service provided by Allstream, Persona or Rogers, you'll be funneling an extra payment into the provincial treasury.
If not then the province is double-subsidizing the private sector, first by investing in this project and secondly by foregoing legitimate revenues in order to recover the public investment.
6. The next easiest thing to wonder is where this "telecommunications strategy" thing came from. The minister mentioned it at Thursday's newser but truthfully, I haven't found a single person outside of a handful directly involved who had heard of it before. We do know that persona approached the Premier some time ago with this expensive scheme; it took the fire at Aliant to push cabinet into investing in it.
But the most obvious thing to ask is this:
If Danny got into telecomms just before he sold off Cable Atlantic, should we all be wondering what he is going to flip the province for and who the prospective buyer is?
_____________________________
Update: nottawa has been slogging away at the telecom thing for a few days now.
Check his posts here and here.
