Ashland Fiber Network is in a jam. They are a city agency and therefore do their business in public and take direction from the public votes and discussions of the city council.
However, says Mark Holden, city director of Information Technology, AFN is in a very competitive world and if their “product definition and product price” are public, it shrinks their competitiveness — and revenues.
In a report Tuesday to the City Council, Holden implored the council to let city Administrator Dave Kanner make the decisions, based on skull sessions with him — and consultations, perhaps monthly with the mayor and council president, to apprise them of what’s going on.
Council members were clearly moved by the argument — and the need for trade secrets in the fiber-net world — but they realized they faced new territory. As Kanner put it: “Is this a competitive enterprise that happens to be owned by a city or is it a public utility? It’s a conundrum.”
After much debate, the council voted 4-2 to give the city administrator temporary authority to make final decisions on prices and products until the council determines the final form of governance between the city and AFN.
Councilor Greg Lemhouse said the move was an intermediate step, as the city explores all options.
“It’s not a perfect choice,” he said, “but it’s a little more flexible.”
“How do we allow AFN the flexibility it needs in the business world?” said Councilor Pam Marsh. “It’s important to give them the best opportunities in the market.”
“If we leave the city council out entirely,” said Councilor Mike Morris, “we could possibly be blindsided. But with the competition, I see how it could be necessary.” He wanted a two-year tryout of the arrangement, to see if it really works.
“You’re trying to be competitive and get the jump on things,” said Councilor Stefani Seffinger. “You don’t want to give information to the competition.”
Councilor Rich Rosenthal demanded and got a sunset (the end of the year) and observed, “There’s something about this that makes me uncomfortable. I don’t buy it. The City Council approval is not its weakness.” (Jan. 26: This paragraph has been corrected. The word "not" was added in the last line.)
AFN is “already going down that road,” as outlined in the decision-making vote and control of AFN’s Strategic Business Plan, said Kanner, so approval of the plan is a “formality.”
“Authorizing the decision process to the city administrator,” said Holden in his report to the council, “will enable the division to quickly react with new product introduction/pricing, the introduction of competitive products and changes in competitive product marketing. The advantages will be garnered without exposing AFN plans to advanced competitive scrutiny.”