Tom Moore Steps Down as CEO of Wildblue Communications

In a surprising move today, Tom Moore stepped down as the CEO of Wildblue Communications. The rollout of Wildblue has been very slow and many have said a bit too bumpy. There are only about 5-6,000 customers on the books since the first customer was brought on board in early June.
Here is what Tom Moore had to say: "My contribution has always been in formulating ambitious dreams and starting things from scratch...WildBlue now needs a world-class operating CEO to drive the company to the next level of success."

Here is what Bob Phillips, President of the NRTC (big investor in Wildblue) had to say: "I interviewed and voted for David Leonard for the position of chief executive officer. Leonard’s forte is business operations, and I am confident that he will provide the focus necessary for successful operation of the company."

Here's what I have to say: "The boys at Liberty Media (Another big investor in Wildblue) and the NRTC got together and decided the Wildblue Internet rollout was chaotic at best and a near disaster at worst. They wanted to try to stop Direcway from cleaning their clock with the DW 7000 and knew a change needed to be made quickly to get the momentum going again. David Leonard was a top executive of Liberty Media.

Stay tuned.....it's getting more interesting each week!

Direcway and Wildblue - Fall Showdown?

There is a cat fight brewing between Direcway LLC, Starband and Wildblue Communications for the large number of people in the U.S. who can't get some type of broadband internet and are willing to pay $50 or more to get better speeds. The combatants are telling investors that there are 20-30 million "potential users" out there in rural or underserved America...true, but the historical fact of the matter is that up to now, only 500,000 or so have been willing to pay as much as $50-$100 a month for the "so called" high speed services offered by Direcway, Starband and now Wildblue.
What has changed to stir all the press and advertising hubub by the companies? The claim is that both the Wildblue ka band and new Direcway 7000 offerings will finally give consumers a more DSL/Cable-like internet experience...ie lower latency and higher upload speeds. They expect that tens of millions of rural Americans will flock to their doors to pay over $50 per month to be "connected". To a degree they are right. It has become virtually impossible to funcion as a business without broadband internet and it is more and more difficult as a consumer to do without it. Even retailers (who obviously target consumers) are building sites that are very difficult to navigate unless you have a fast connection to the net. Pictures chew up bandwidth.
More and more people have found it less expensive to buy over the net...after all, we are nearing $2.50 gas now and who knows where it will end up. Imagine the cost of going to a store in a rural area in a vehicle that is getting 12 mpg (pickup with a V8) with $2.50 gas? Quick math says it would run you about $16.00 for an 80 mile round trip.....do that three or four times a month and buying at home from your easy chair starts looking pretty good. And you have time left over to plow a few fields if you like. Pretty easy picture to get. The problem is that all too many rural Americans already figured that buying from home is a good thing...they just do it by the old reliable U.S. mail order system. No computer or internet required.
The marketing effort by the "combatants" needs to focus on how much better the experience will be over the net. Perhaps they can throw in some instructions on how to overcome the fear of computers and typing as well. This is what I beleive is hampering the efforts to reach rural America by satellite internet...fear of the potential user of new ways of doing things. This is a generational thing...younger rural folks are going to find the internet the only way to travel in the future, but by then WiMax should cover most of rural America with cable/dsl-like speeds and pricing. The point of this piece is to warn investors....don't make a long term bet on Wildblue or Direcway! They will provide a temporary bridge to up to 1,000,000 or so underserved rural consumers, but they will never reach the vaulted numbers they strive for and try to interest investors in, and thus, never make much money, if any.

Randy Scott