Addressing the inequality: The War on Upstart Fiber Optic Internet Providers

This is a fascinating insight into real struggles faced by an internet service provider (ISP). The blog post goes on to discuss the quirks of landing a fibre in the “neighbourhood”. I got interested in this because of the professed bleeding hearts that cried hoarse about the “universal inclusion”.

This is a brief overview of issues invovled:

When you install a service underground, you own it for life. There are no annual fee’s. You pay one time to install it and you’re set for life. This sounds like a pro, but it’s also a con. When we run metro conduit, it generally costs us between $15-25/ft (not including customer drops). For the sake of argument, let’s assume we’re at the high-end of our costs. If we install 1,000ft of conduit, that’s $25,000 that we need to pay out of pocket upfront. Some blocks have upwards of 30 customers, but others have as little as 5. Let’s average it out at 20 customers per block, that’s $1,250 upfront per customer, assuming we get every single customer. Conservatively, we’re initially looking at a 50% take rate.

The War on Upstart Fiber Optic Internet Providers | Chris Hacken

In one of my earlier iterations online, I had been covering the broadband specifically. It had been an uphill struggle to get a reliable dial up while the major players never got interested to push their offerings. For obvious reason, the business case was meant for a high density of people with the ability to pay. Are people willing to pay? That’s another story.

Circa 2000-14, there was no “Netflix” or the streaming services. Online gaming was relegated to a niche. No one had ever thought about working from home and Zoom was what we used for the point and shoot cameras. The pandemic upended the cosy assumptions and the demand for reliable Internet has shot up for obvious reasons.

Tangled mess

Wireless internet (4G or even 5G) will always suffer from issues related to latency. The video codecs have improved to be serviceable, but it is always a challenge to have a service level agreement with the ISP, for residential broadband. It is reflective of industry worldwide since the telcos provide service on as-it-is basis for the home owners. Therefore Telemedicine and other assorted services will always run into challenges.

Everyone wants to latch on to seemingly unlimited federal cash cow’s udders; however, local implementation rules and policies require an overhaul. Monopolies and upstart local politicians will always create trouble for infrastructure creation by demanding a “right of way”. These rules need to be harmonised by designating fibre as a national asset and importance. The high rates of access are usurious and if you dig deeper, bandwidth is cheap (and plentiful). The last mile access is a major determinant for eventual prices.