Before we go any further, allow me to say a few quick words to those who have already contacted us about the Gateway Greens cable contract.
The HOA board is working to gather information, and the impression I get is that the HOA board intends to be transparent. The Gateway Sun has looked over two of the community cable proposals and a summary of a third proposal, and we do have one pretty serious question that we’ve forwarded along to the HOA and one of the bidders. The HOA president responded and said our question was “not being ignored” and he asked for some patience due to a high number of inquiries they’ve received. The company we contacted said they were sending my question higher up the food chain.
So we wait.
And while we wait for responses, there’s one detail of the cable contract that I found fascinating: the “door fee” as one provider calls it or the “exclusive marketing fee” as another calls it.
When some communities are built, a television and internet provider like Comcast or CenturyLink will pay the developer a certain sum in exchange for putting their service in every unit and mandating its use.
But those contracts inevitably expire. And when they do, it’s an opportunity for a competitor to swoop in and take over the contract. The main carrot the companies dangle is a lump-sum payment to the HOA.
In Gateway Greens, the community’s contract with Comcast is coming to an end. Comcast and two of their competitors named Blue Stream and Hotwire have all shown strong interest in providing service to Gateway Green’s 1,350+ units.
Hotwire offered the Gateway Greens HOA the sum of $272,600 for a 10-year deal with the community, while Comcast offered $340,500 and would give the community the choice of a 9 or 10 year deal, and Blue Stream is coming in with a whopping $613,500 payment for 9 years.
In terms of connection speed, both Comcast and Blue Stream are offering 100 megabit per second service, but Blue Stream says they’ll increase the speeds to 200 mbps in Year 3 of the deal, and to 300 mbps in Year 6. Hotwire says their service will be 200mbps.
In reality, unless you plan on having five or six 4K televisions all on at the same time then 100mbps is more than enough. Besides, 100 megabit or 300 megabit is only the speed between the home and the community’s hub – not the speeds you’ll ever see on the internet. At least not in 2019.
In 2026? Who knows. Maybe being at 200 or 300 megabit would be a benefit.
Blue Stream also said they were faster than Comcast in terms of their direction connection to Netflix. This is a claim that is technically true but they leave out A LOT of information.
Comcast’s connection speeds to Netflix have been measured and announced by Netflix since November 2012. Meanwhile, Blue Stream’s connection speeds only began being announced by Netflix about 60 days ago.
In Februrary 2019, Blue Stream came in at 4.53 mbps, while Comcast was 4.52 mbps. In March 2019, Blue Stream was at 4.55 mbps and Comcast was 4.51 mbps, according to Netflix.
What Blue Stream did not mention was that Hotwire was actually the number one provider in the United States out of the 75 or so that Netflix tests and announces. Hotwire’s speeds in February and March were 4.78 mbps and 4.82 mbps respectively.
In March, Hotwire was fastest in the USA while Blue Stream was sixth and Comcast was eighth nationwide. Netflix began publishing connection speeds from Hotwire in September 2017.
In terms of pricing, Blue Stream’s base service was $64.95 while Comcast’s is $68.50. However, since there are a bevvy of options and upgrades that an individual customer could choose it makes it impossible to go through all the possibilities. In the grand scheme of things, the price difference between Blue Stream and Comcast don’t seem egregious. Hotwire came in with a low price in Year 1 of $57.99 that jumps to $80.98 in Year 2.
Gateway Greens formed a committee to examine the cable situation and evaluate proposals. While the committee’s input will weigh heavily, the HOA board will make the final decision. To help the committee, they hired Converged Services Consult, a consulting firm. Working together, the committee officially recommended that the Gateway Greens HOA board drop Comcast and hire Blue Stream.
That led to the question that the Gateway Sun posed to the HOA. It had been brought to our attention that Converged would make more money for their services if the community chooses Blue Stream. So when the committee chose Blue Stream over the far more established and well-known Comcast, it raised a few eyebrows.
Our question was whether or not it’s true that Converged earns more (in a commission type scenario?) if one company is chosen over the other, or whether Converged gets a flat fee for their services no matter what the community chooses. Again, the HOA president has acknowledged my question and once it’s responded to we’ll publish the answer.
While everyone knows who Comcast is, most people are unfamiliar with Blue Stream. Next week we’ll publish an article about who Blue Stream is, and what we’re able to find out about them – including some customer reviews that aren’t flattering. (Make no mistake, Comcast isn’t exactly hailed as a bastion of customer service either.) Look for that article early next week.
For some people in Gateway Greens, they’re comfortable sticking with Comcast because they know exactly what they’ll be getting. The same cannot be said about Blue Stream. For that reason there’s a natural apprehension and curiosity in the community about the potential switch.
Gateway Greens’ contract with Comcast expires December 31, 2020.
EDITOR’S NOTE: The door fee figures published above were from Converged. Blue Stream’s proposal contained a slightly lower number, but both Converged and Blue Stream’s figures say that the payment will be $450 per unit in Gateway Greens. The author of this article is not a Comcast, Blue Stream or Hotwire customer.