Another stance could be to tell them that they have to open it up for other players to ride their fiber.. Think if you can come in and go, for xyz install, and you supply the bandwidth, you can charge what you want, and deliver xyz bandwidth. Now you are riding their fiber, and deliver to your customers, if you bulid it now, and convert them to fiber when it comes then you are good, they are bearing the cost of the fiber installation (the most expensive part) and you are just paying for transit..
If and when their business model goes kaput, you would be in a great position to buy it for pennies on the dollar as you already have a vested interest in it. Just another thought. Dennis Burgess, CTO, Link Technologies, Inc. den...@linktechs.net<mailto:den...@linktechs.net> – 314-735-0270 – www.linktechs.net<http://www.linktechs.net> From: Af [mailto:af-boun...@afmug.com] On Behalf Of Ken Hohhof Sent: Tuesday, July 07, 2015 8:00 AM To: af@afmug.com Subject: Re: [AFMUG] Plan to Compete with Municipal Fiber? The common assumption is that Internet prices are greatly inflated due to lack of competition, and if there were more competition, a price war would ensue and prices would drop dramatically. Not sure if this is true, but if so, the likely result would be covering just the operating costs, or even not that if other people’s money is being used to cover the losses. Eventually you end up with infrastructure that has not been properly maintained and upgraded, like has happened with the copper infrastructure. OK, fiber might need less maintenance and upgrades than copper, but I’m sure they would find a way to let it fall apart due to neglect. If nothing else, people seem to keep cutting fiber, accidentally or on purpose. I find it interesting that around us, we typically have 4-5 WISPs fighting over a sparsely populated rural area, not to mention satellite and mobile broadband plus DSL and cable in town. Yet I don’t see a race to the bottom on prices among the WISPs. And the ones that try to price a little lower tend to have oversubscription and reliability problems. I think there’s a realization that while you could compete primarily on price, you wouldn’t bring in enough revenue to build/maintain/upgrade a quality network, and your service would suck. If not immediately, then over time. So the competition tends to be more on service and who has a tower with LOS to a particular customer. Other people’s money (federal, municipal, or outside investors) alter this thinking, but eventually you have to pay the piper. From: Lewis Bergman<mailto:lewis.berg...@gmail.com> Sent: Tuesday, July 07, 2015 7:03 AM To: af@afmug.com<mailto:af@afmug.com> Subject: Re: [AFMUG] Plan to Compete with Municipal Fiber? 100% agree with Brian. This seems to be the path for about 99% of the Muni WISPS out there. Keep your eye on it, get to the know the staff. When the pain seems to get to much for them to bear offer to step in. The only thing you will have to deal with is the customers who think you should charge, or give for free, with the same structure a tax funded entity couldn't make work. That won't matter since those socialists can't understand logic there is no use explaining it to them. On Mon, Jul 6, 2015 at 10:06 PM, Brian Webster <i...@wirelessmapping.com<mailto:i...@wirelessmapping.com>> wrote: My suggestion would be to just wait it out. Let them build it and lose money. Eventually they will realize that they have no idea how to be an ISP, the customers will not deal with slow government response times to complaints, and the government will hate dealing with title II issues and open internet regulations. They will throw their hands up and offer it via bid or something else to a private company to manage/own/run. You might be able to pick it up for far less than it would have cost you to build. I certainly would not try to overbuild them before they get going. The average consumer has already heard about their promised prices, you will be fighting that even though they have not even started building yet. Do a search for the UC2B project in Illinois, it was a municipal/university system built with stimulus funds. They did what they needed to meet grant obligations, then they all argued among the partners about who and how they would run things and failed at that. They finally let a private company take over and expand the system. Thank You, Brian Webster www.wirelessmapping.com<http://www.wirelessmapping.com> www.Broadband-Mapping.com<http://www.Broadband-Mapping.com> From: Af [mailto:af-boun...@afmug.com<mailto:af-boun...@afmug.com>] On Behalf Of Carl Peterson Sent: Monday, July 06, 2015 8:45 PM To: af@afmug.com<mailto:af@afmug.com> Subject: Re: [AFMUG] Plan to Compete with Municipal Fiber? Assuming you didn't have to recoup build costs, I don't see how it would be hard to run the network at $50 per sub. Bandwidth is dirt cheep at scale and there isn't much to go wrong with a fiber plant. On Jul 6, 2015, at 3:10 PM, Christopher Gray <cg...@graytechsoftware.com<mailto:cg...@graytechsoftware.com>> wrote: About $40M is grant funding from the state for "last mile" services that is only available to municipalities. The balance of the funding is coming from town borrowing. My town will receive about $1.2M from the grant and will vote in September whether to authorize $2.3M of borrowing that would be paid with property tax. I'm 95% sure this will go through, and the network would be lit in about 3 years, but I can't get their numbers to work out. I cannot see how they can actually provide service and maintain their network and offer a base service of only $50 / month. If that jumps to $100, I could see remaining competitive, though. On Mon, Jul 6, 2015 at 1:58 PM, Chuck McCown <ch...@wbmfg.com<mailto:ch...@wbmfg.com>> wrote: Where is the funding coming from? I would not be comfortable building in an area where I am sure to get over built. From: Christopher Gray<mailto:cg...@graytechsoftware.com> Sent: Monday, July 06, 2015 11:56 AM To: af@afmug.com<mailto:af@afmug.com> Subject: [AFMUG] Plan to Compete with Municipal Fiber? Several of the rural towns in my planned coverage area are looking into municipal fiber (average density about 10 premises per fiber mile, all above ground). They're claiming $50 for 25 Mbps service, $79 for 100 Mbps, and $109 for 1 Gbps. They already have funding authorized in about half of the towns they are targeting... but they'd be about 3 years from providing any service. Is it reasonable or possible to compete with such a thing? Should I ignore any area that plans to fund this, or might it be worth getting a foothold before their system is lit? Thanks - Chris -- Lewis Bergman 325-439-0533 Cell
