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APPLIED COMMUNICATIONS

APPLIED COMMUNICATIONS. Lessons Learned from Rural Broadband Initiatives. Lesson One. Success doesn’t happen overnight. Case Study - Grant County . Grant County Public Utility District installed fiber backbone between substation. Fiber to the home roll-out began in 2001.

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APPLIED COMMUNICATIONS

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  1. APPLIED COMMUNICATIONS Lessons Learned from Rural Broadband Initiatives

  2. Lesson One Success doesn’t happen overnight.

  3. Case Study - Grant County • Grant County Public Utility District installed fiber backbone between substation. Fiber to the home roll-out began in 2001. • Initial slow take rate below projections • Quincy, WA - Population = 5,300 • In 2006 – Microsoft, Yahoo and Intuit announced plans for data centers. (Fiber + Low Power Costs) • “One Tiny Town Become Internet Age Power Point” (Wall Street Journal – 3/7/07) • 1000 new workers = Housing Shortage

  4. DIFFUSION CURVE Rural Telecon “98”

  5. Lesson Two “The power to transform will play out unevenly and in stages.” (Business Week 3/26/01)

  6. THE STATS • broadbandproperties.com 2004 = 200,000 homes passed by fiber. 2006 = 4 million 2008 = 10 million 2011 = 64 million • Muni-Wireless public wireless networks/hotspots 2005 = 122 2006 = 312 2007 = 415

  7. PEW INTERNET PROJECT In 2007 47% of all adult Americans had broadband connections. Only 31% of homes in rural areas had broadband. High Cost + Low income = Lower Penetration Rates Geraldine, MT = $59 for 1.5 mg DSL

  8. Lesson Three One size doesn’t fit all.

  9. Applications – Fiber or HFC • Load Management for Electric Utilities (Fiber) • Home Automation (FTTP) • Cable TV – Video Conferencing

  10. Applications - Wireless • Public Safety – Mobile applications for Police & Fire • Public Works/City Inspectors Mobile applications • Free Internet (Wi-Fi)

  11. Lesson Four “You can’t have always get what you want.” Source: Mick Jagger

  12. Marshfield, WI – Case Study • Charter Cable – Regional Fiber Backbone, Fiber to Clinic & other businesses in town • Verizon – DSL, Fiber Sonet-Ring • Poor service in rural areas • No fiber in industrial parks on town’s edge • No Wi-Fi hot spots

  13. Evaluation Measures • Cost-Benefit • Economic Development • Public Support • Financial Liability • Commitment

  14. Lesson Five Metcalfs Law – “The Value of a network grows with the number of users.”

  15. Take Rates • Take rates ranged from 20% - 80%. Averaged around 40-50%. • Cable take rates have been higher than Internet • Marketing surveys generally indicate higher interest level than actual take rate • Takes several years to penetrate market • Competitors might enter market (Applied Communications – Public Broadband Database)

  16. Lesson Six There is no such thing as a 100% success rate in business or in telecommunications.

  17. Business Plan • Select Appropriate Business Model • ROI – 5, 10, 15 years? • Risk Analysis • Marketing • Financing – Grants, fees, bonds, recapture, …

  18. Lesson Seven Planning can be a catalyst for action.

  19. Marshfield, WI – DSL for Hewitt • Douglas, WY – Cable Modems • Sandpoint, ID – RFP for services spurs Qwest • Havre, MT – County Commissioners allow co-location

  20. Lesson Eight Don’t get trapped by paralysis analysis.

  21. Strategies • Find a niche • Pilot project before full deployment • Phase in, deploy to areas of high demand to generate revenue • Decrease risks – Partner, pre-lease, piggy back on other projects

  22. For More Information Kate McMahon Applied Communications (406)863-9255 kate@appcom.net www.appcom.net

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