published Thursday, October 4th, 2012

Gig Tank winner settles for less

Aaron Welch, chief executive officer for Iron Gamer, delivers his pitch to the crowd and the judges during the GigTank Demo Day in August.
Aaron Welch, chief executive officer for Iron Gamer, delivers his pitch to the crowd and the judges during the GigTank Demo Day in August.
Photo by Jake Daniels.

All Aaron Welch wanted was a gig.

As a gamer running a video game business, he desperately craved the ability to overwhelm his online opponents with waves of unimaginable Internet bandwidth.

He pleaded with EPB officials to run a strand of their famous gigabit fiber to Iron Labs' office in the CitiPark building, a block and a half from the utility's downtown headquarters.

For four months he tried to negotiate a deal. But it was too expensive, EPB said. If gamers used even one-tenth of a gigabit, the cost to EPB could exceed $25,000, according to internal emails.

Eventually, Welch, the winner of the EPB-sponsored Gig Tank competition in August, decided to get his Internet service from the utility's fiercest rival, Comcast. Today, Iron Labs uses Comcast's 100-megabit service.

"We tried the entire duration of Gig Tank to work out something with EPB," Welch said. "We didn't really need a gig, but we wanted it for advertising."

For winning the Gig Tank contest — which was designed to explore ideas that would specifically take advantage of EPB's gigabit fiber — Iron Labs was given $10,000. Welch also received $15,000 in seed money from Gig Tank sponsors over the course of the summer competition.

EPB provided the Internet connectivity for Welch's team and others during the contest and co-sponsored wireless connectivity at the Sheraton Read House for a day of demonstrations for the participants, the company said.

Welch initially requested free gigabit fiber from EPB as part of a marketing partnership. In exchange for gigabit speeds, Welch planned to operate a gig gaming center — a handful of local servers that would host video game tournaments for EPB customers playing from home.

"We thought that would be the first visual and solid explanation of what the gig looks like — not what it looks like on paper but what it looks like in real life," Welch said.

EPB declined his offer, citing the $50,000 estimated retail value of providing him with the service.

Welch's second request was for standard gigabit service which he would pay for, a service advertised at $300 per month by EPB, he said.

But Welch isn't eligible for the advertised service because the deal is only available for those who aren't going to fully use it, such as residential customers and businesses with low bandwidth usage, said EPB spokeswoman Danna Bailey.

"Companies that are using a lot of Internet aren't going to be in the category of a small business," Bailey said.

Businesses like Iron Labs that actually intend to use a great deal of bandwidth must pay more, Bailey said.

"There is a real cost associated with our delivering this service," Bailey said. "There are professional businesses that are going to use large amounts of bandwidth, and we cannot offer the service to them for $299.99."

EPB charges $9,000 per month for Fi-Speed Internet Professional gigabit service. About 26 commercial customers now pay for the gigabit service, and the utility has eight residential customers.

After getting nowhere with EPB, Welch called Comcast.

Jim Weigert, vice president and general manager of Comcast in Chattanooga, said he liked Iron Labs' proposal to EPB so much, Comcast began sponsoring the video-game company's online tournaments.

"He was looking for some sponsorship help with their grand opening, and they had a lot of tournaments, so we've been helping them with some prizes toward that and some other things," Weigert said.

Instead of $9,000 per month, Welch pays less than $300 to Comcast, though his agreement with the cable giant precludes him from revealing the actual cost of service.

Comcast is exploring the idea of a larger partnership with Iron Labs, Weigert said, similar to what Welch initially proposed with EPB.

"Because we're national, we're seeing if there's something we can do to help him on a broader level," Weigert said. "Small businesses like that are kind of our sweet spot."

about Ellis Smith...

Ellis Smith joined the Chattanooga Times Free Press in January 2010 as a business reporter. His beat includes the flooring industry, Chattem, Unum, Krystal, the automobile market, real estate and technology. Ellis is from Marietta, Ga., and has a bachelor’s degree in mass communication at the University of West Georgia. He previously worked at UTV-13 News, Carrollton, Ga., as a producer; at the The West Georgian, Carrollton, Ga., as editor; and at the Times-Georgian, Carrollton, ...

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