James R. Miller Jr

By DAVID BORAKS
DavidsonNews.net

The MI-Connection cable and internet system has let go its operations manager and plans to replace contract installers with a half-dozen new in-house employees as part of an ongoing restructuring designed to stabilize its finances and deliver a profit. The system’s chief says bringing contract work in-house could save $50,000 a month.

Operations Manager James R. “Junior” Miller, who oversaw a major system upgrade in 2008 and 2009, was laid off in January as part of the restructuring.

Mr. Miller was absent from the January MI-Connection board meeting. His departure had not been announced publicly. But on Friday, General Manager Alan Hall confirmed that he had let Mr. Miller go.

Mr. Miller was hired in summer 2007 as the system’s first general manager. With a technical background, he oversaw a major system overhaul that replaced outdated equipment and added new capabilities. The upgrade, completed last year, has allowed MI-Connection to improve video quality, add channels and video-on-demand services, boost internet access speeds, and add local and long-distance telephone service.

But once the system had been rebuilt, MI-Connection’s focus shifted to marketing. In October, the system named Mr. Hall as general manager and Mr. Miller became operations manager.

Mr. Hall praised Mr. Miller for helping to rebuild MI-Connection’s out-of-date network. But, he told DavidsonNews.net,”I’m looking for a slightly different skill set than what I saw. … I decided it was a decision we needed, to grow the system.”

“It was a difficult decision,” he added.

ADDING 6 EMPLOYEES

Meanwhile, another facet of the restructuring will bring some contract services at MI-Connection in-house, according to Mr. Hall.

He said he expects to add six new employees in the coming weeks – five installers and 1 supervisor – in a move aimed at improving service and cutting costs.

Eliminating contractors eventually is expected to save $50,000 a month, Mr. Hall said.

FLURRY OF CHANGES

Mr. Miller’s departure is the latest in a series of changes at MI-Connection. The company was created in December 2007 when the towns of Davidson and Mooresville purchased the system, which previously had been operated by bankrupt Adelphia Communications.

While the two towns own MI-Connection, they have hired an outside company – Bristol Virginia Utilities (BVU) – to run it.

By most accounts, the upgrade that Mr. Miller led was a success. In September, a trade group called the National Association of Telecommunications Officers and Advisors named MI-Connection as its 2009 Community Broadband Project of the Year. The group cited the towns because they “refused to accept sub-standard broadband and cable service and decided to deliver better quality themselves.”

But the weak economy and intense competition from satellite TV services and other telecommunications firms has stalled customer growth at MI-Connection. The system’s original business plan envisioned steady population growth in the area and with it, customer growth.

That hasn’t happened. The lack of growth has contributed to lower-than-expected operating profits. Last month, the board approved a revised budget that included a $576,604 shortfall, which Davidson and Mooresville will have to fund from their town budgets – something they had said wouldn’t happen.

Since last summer, the towns and BVU have taken a variety of steps to cut costs and improve the picture.

Those included renegotiating the towns’ contract with BVU, layoffs last summer, the hiring of Mr. Hall, and changes at the system’s board.

Under the system’s bylaws, the board balance shifted last fall from a 3-2 Davidson majority to a 3-2 Mooresville majority. Mooresville’s John Kasberger took over as acting chairman after former chair Evan Webster of Davidson rotated off the board. Davidson and Mooresville also have appointed new representatives to the board in recent months.

RELATED COVERAGE

See DavidsonNews.net’s past coverage of MI-Connection under the “Cable TV” category.

CLARIFICATION: The last paragraph of this story has been updated 2/16/09 to clarify that former MI-Connection board chair Evan Webster’s departure from the board last summer came as part of the board’s automatic re-balancing.