WildBlue Internet Catch-22 and contacts

Ok. Here we go. This will be a very long post. I’ll let our capable blog host decide whether this post needs to be broken into smaller segments and which blog category it belongs in.

From a personal perspective, our initial goal was to apply pressure to Wildblue so they would come out and fix their system. This is no longer our goal. We now want a full refund of all money spent on Wildblue to date, full and complete release from contract and no further dealings with Wildblue for the remainder of our lives. We were not, and still are not, specifically seeking ways to punish Wildblue, but if that happens, Hey, Too Bad, they’ve brought it upon themselves.

It occurred to me last night that there may just be a way to apply a significant amount of pressure to Wildblue and force them to start dealing forthrightly and quickly with disaffected subscribers either without resorting to formal legal action, or by making formal Class Action filing the end of a process, not the start of one. In fact, the more I think about it, the better I like the concept. Try this on for size.

Those of us who are the proud owners of slow, intermittent or dead Wildblue systems, whatever our number may be, are trapped in Wildblue’s version of Catch-22. That being “We have no parts available to repair your system, and even if we did, the replacement parts would be no better than the parts you already have, and even if these replacement parts were of better quality, we still use installers who do substandard installations.” That’s the first half of Catch-22. The second half is that from what we’ve been able to gather, Wildblue is still installing new subscribers using whatever existing unreliable parts and substandard installers they have! Here’s why.

Large blocks of Wildblue stock are owned by several large corporations, I’ll tell you their names in a minute. These corporations expect, some would say demand, a robust return on their investments. New subscriber installs represent cash inflows, revenue, not just right now but in the future as well. Remember, we all had to sign up for a minimum of 12 months. Each new subscriber and the revenue they represent help Wildblue drive their stock price higher. Repairs to existing installs represent cash outflows, expenses, not in the future but right now. Every repair forces Wildblue to spend cash right now which obviously weakens the company’s stock. There’s less hardware for new installs and less money for the investors.

By installing new subscribers at as fast a rate as possible and locking them into 12 month contracts Wildblue can inform all the Wall Street analysts that subscriber growth rates and revenue forecasts are increasing. Result: Stock goes up, investors are happy. By repairing existing deficient subscriber systems at a low and slow pace, and by denying subscriber contract releases, Wildblue is under-representing; you could even say disguising, the true scope and costs of system deficiencies from those same Wall Street analysts. Result: stock continues to go up, investors still happy, but now a disaster is brewing. Wildblue can keep the Catch-22 going only until one of two things happen.

The first is the very reason our host created this blog, to gather disaffected subscribers into a unified group and file a Class Action in a court of law. But maybe there is an alternative, and as I said at the beginning of this post, the more I think about it the more I like it.

That same group of disaffected subscribers, acting individually, can still generate a great deal of pressure, as if they were banded together, and put Wildblue on trial in three different courts. First is the court of corporate governance. Second is the court of financial disclosure. Third is the court of public opinion. The media!

Here’s how we’re proceeding. If this approach appeals to you, feel free to replicate it.

There are two senior executives at the helm of Wildblue. They are:

David J. Leonard
Chief Executive Officer
Wildblue Communications, Inc.
Building One
5970 Greenwood Plaza Blvd
Greenwood Village, CO 80111
Fax: 720.554.7500
Fone: 720.554.7400

Kenneth G. Carroll
President and Chief Operating Officer
Wildblue Communications, Inc.
Building One
5970 Greenwood Plaza Blvd
Greenwood Village, CO 80111
Fax: 720.554.7500
Fone: 720.554.7400

We have sent via certified mail, and faxed, a letter to these two individuals outlining our dissatisfying and unacceptable 86 day experience with Wildblue noting their apparent inability to repair the system, their unwillingness to provide timely billing adjustment and their unresponsiveness to repeated requests for full refund and immediate contract termination. We also noted in the letter that copies have been sent to the Illinois Attorney General’s Office of Consumer Protection, to our credit card company instructing them to block any further charges from Wildblue and to the Denver Better Business Bureau. http://denver.bbb.org

We are now also going to send copies of, and fax the letter to the seven members of Wildblue’s Board of Directors. They are:

Mark D. Carleton
Wildblue Board Chairman &
Senior Vice President
Liberty Media Corp.
1200 Liberty Blvd.
Englewood, CO 80112
Fax: 720.875.5401
Fone: 720.875.5400

Gary S. Howard
Executive Vice President, COO &
Director (retired)
Liberty Media Corp.
1200 Liberty Blvd.
Englewood, CO 80112
Fax: 720.875.5401
Fone: 720.875.5400

Liberty Media Corporation owns 32% of Wildblue stock.
The next two Board Members are:

David McGlade
Chief Executive Officer
Intelsat
3400 International Drive, NW
Washington, DC 20008
Fax: 202.944.7898
Fone: 202.944.6800

Phillip L. Spector
Executive Vice President, General Counsel
Intelsat
3400 International Drive, NW
Washington, DC 20008
Fax: 202.944.7898
Fone: 202.944.6800

Intelsat owns a block of Wildblue stock as well. I don’t know how much…yet.
The next two Board Members are:

Walter S. Segaloff
Don’t have any info…yet!

B. R. Phillips III
President and Chief Executive Officer
National Rural Telecommunications Cooperative
2121 Cooperative Way
Herndon, VA 20171
Fax: 703.464.5300
Fone: 703.787.0874

Mr. Segaloff was a co-founder of KaStar Satellite Communications and was involved in the early development of Wildblue.

Mr. Phillips’ firm, the National Rural Telecommunications Cooperative owns a block of Wildblue stock. I don’t know how much…yet. The NRTC partners with our local Rural Electric Cooperatives across the nation to provide rural citizens with modern, high quality telco, tv and internet services of all kinds, hardline, fixed wireless, mobile wireless and satcom systems like Wildblue.

Before I mention the name of the final member of Wildblue’s Board of Directors I’m going to mention three other names that we are sending and faxing our letter of dissatisfaction to. They are:

Dr. John C. Malone
Chairman
Liberty Media Holding Corp.
12300 Liberty Blvd.
Englewood, CO 80112
Fax: 720.875.5401
Fone: 720.875.5400

Gregory B. Maffei
President and Chief Executive Officer
Liberty Media Holding Corp
12300 Liberty Blvd
Englewood, CO 80112
Fax: 720.875.5401
Fone: 720.875.5400

As stated above Liberty Media controls 32% of Wildblue stock and holds two seats on Wildblue’s Board of Directors. The two individuals who are the primary recipients of our letter, Mr. Leonard and Mr. Carroll both have positions at Liberty Media in their backgrounds. We believe this is an indication that Liberty Media is the majority shareholder and has injected at least four of its people into Wildblue to watch over Liberty Media’s investment. So we figured, why not let the heads of Liberty Media know how we feel as well.

There is one other firm name that surfaced during our financial investigation, as owning a block of Wildblue stock. We’re sending and faxing a copy of our letter to them as well, why not. I don’t have the name of the specific Senior Partner that is in charge of their Wildblue holdings…yet. They are a Venture Capital firm named:

Kleiner, Perkins, Caufield and Byers
2750 Sand Hill Road
Menlo Park, CA 94025
Fax: 650.2330300
Fone: 650.233.2750

The final member of Wildblue’s Board of Directors and the last individual to receive a copy of our dissatisfaction letter, at least here in Round One, is:

Thomas E. Moore.
Principal
TimesArrow
4600 South Syracuse, Suite 900
Denver, CO 80237
Fax: 303.256.6205
Fone: 303.256.6655
www.timesarrow.net

Tom Moore had a dream. He wanted to be able to leverage the DOCSYS(tm) modem platform he helped create and patent to bring broadband to the millions of citizens in America that were disenfranchised from broadband access due solely to their rural location. Tom brought that dream to life as one of the original co-founders of Wildblue in 1998. He served as Wildblue’s President, CEO and Director from 1998 to 2005. He still holds a seat on Wildblue’s Board. If Wildblue has a father, it’s Tom Moore. If anyone has the right to grab current Wildblue Management by the ear, drag them out behind the woodshed and slam a hockey stick up side their heads, it’s Tom Moore.  It certainly appears that for a goodly number of Wildblue subscribers, Tom Moore’s dream has turned in to our nightmare.

The question devolves to this. For those of you old enough to remember Watergate, it will sound vaguely familiar.  How much do the members of Wildblue’s Board of Directors and its major Investors know, and when did they know it?   How informed are they about what certainly appears to be system-wide hardware failures in the form of water logged TRIA’s, system-wide hardware shortages, system-wide shoddy installations and a growing system-wide subscriber base that feel victimized and want out, and want out NOW! The rules of Corporate Governance have changed. Members of Boards of Directors can no longer just show up and collect their fees. Board members are now held to much higher degrees of accountability for the actions of the managements at companies on which they serve.

If enough of us send legitimate, well reasoned complaint letters to Wildblue Senior Management and include Board Members and major shareholders on our complaint letter distribution lists, something will get done. How many of us is “enough?” I don’t know, but if I were a Board member and received even 10 such letters, I’d sure as hell be firing some pointed questions at Wildblue Management during the next Board meeting.

The material above constitutes Round One. And just to complete my thoughts…

Round Two would consist of re-sending and re-faxing the original complaint letter, with a new short cover page, something like “We’re still waiting”, to all the same people mentioned above and in addition, now send and fax the letter to the various Wall Street analysts who cover Wildblue. And, you include the names of the analysts on everyone’s copy. I don’t have a list of analyst’s names…yet!

Round Three would consist of re-sending and re-faxing to everyone in Round One and Round Two and in addition, now send and fax the complaint letter to 60 Minutes, CNN, Drudge, Forbes Online, the FCC, the SEC…once again, you include these new names on everyone’s copy. You get the idea. We just keep widening the distribution and at some point the dam will break.

I’m fairly certain there are a number of competent and reputable investigative journalists and investigative news organizations all across the country who would be very interested in a situation such as ours. We have the necessary tools to accomplish this right here on our desk tops. The internet is many things, some good some bad. One thing the internet IS exceptionally good at is viral distribution. We’ve all received links from friends to video, audio and text that have exploded in the internet cloud and replicated rapidly. A viral Wildblue complaint targeted at the Wildblue subscriber base and delivered through a reputable online investigative source would almost certainly generate a great deal of interest and visibility and draw more dissatisfied subscribers out of the darkness.

Round Four is, of course, all of the above and a formal Class Action Filing.

I’ll apologize again for the length of this post but the subject matter dictated the length. I wanted to fully inform anyone who’s searching for a way, short of formal legal filings, to pressure Wildblue into addressing our collective concerns. I’m also comfortable posting all this information in the public internet cloud. All the information gathered is public anyway. And what if Wildblue management is monitoring this blog, what can they do? Tell all their Board members and major investors;

“Hey, you guys are gonna be getting a bunch of letters from some distraught and deranged subscribers. Don’t worry about them, just toss them.”

Any Board member or Investor with a brain and a pulse, hearing that type of comment from management, is going to read each of those letters very carefully, if for no other reason than to make sure they don’t have any personal liability or exposure. I honestly believe if even 10 or 20 disaffected subscribers engage Wildblue Senior Management, Wildblue Board members and major Wildblue Investors in a documented complaint chain, the company will have no choice but to start dealing with our issues, and quickly. Because if existing subscriber complaints start gaining media visibility, new subscriber install rates will begin to slow, possibly dramatically.

Result: Stock price drops, Investors get pissed, holes get dug in the desert and somebody gets whacked!

Oh, and we just might get our money back too! It’s worth a try.

Regards
Jake