Four years ago I read an article in Broadband Properties magazine with frightening implications. This caused me to write a blog post, Community Fiber - Read the fine Print. Well, through to the wonder of Google, I've just been connected to a group of people who were caught in exactly the kind of trap I was worried about.
It works as follows: The developer of a planned community or condominium enters into an exclusive marketing agreement or a bulk services agreement for communications services (Internet, TV, phone, etc.) for the community. The contract is placed with a firm run by the developer's brother-in-law, or otherwise set up to benefit the developer. The initial rates look good and prospects are sold on the idea that their new residence comes with state of the art communications services.
Later, after the developer has sold most units and the community is up and running, it turns out the communications contract is not such a great deal, but it's a solid contract and it runs for 25 years!
That's right, 25 years.
As chronicled by BanBulkBilling.com, this is now a problem for at least many dozen communities developed by many different developers. Of course there are consumer protection laws in most states, but that's a long hard slog - good for the attorney's but not so great for home owners associations.