34 months to recoup on infrastructure isn't bad, and if other things can be run off of that (cell towers and whatnot) for which significant sums can be charged (DF or wavelength services to a tower) then that becomes even shorter.
We normally estimate 5-7 years for a full payoff (including the service) - if we're looking at $10k/mo for bandwidth (I don't know what the price of an interconnect is at Flagstaff but let's assume something like $50/mb/mo), so using your numbers you're looking at 200mb in to 1000 subscribers which is 200k per subscriber, which when contended - as consumer broadband is - is not bad.
And at $50 per month per subscriber, you're still only looking at ~43 months to pay off the infrastructure and break-even on the service (not including other OPEX, interest and whatnot, of course - expand it out and somewhere in the vicinity of 60-84 months would be a reasonable OTOH estimate).
HOWEVER, Wikipedia says there is only 554 residents, so it's safe to say only about 200 households at the most, which, assuming all else was equal, multiplies either the price by 5 times ($250/mo) or the payback time (up to 35 years). The alternative being that we estimate the cost of the wholesale connect to be less (say $2000/mo for say 50mb) but that doesn't make much of a dent overall: at $70/mo, you can spend $12k on paying back the infra and $2k on the bandwidth but you have a payback time of 142 months, which is probably longer than most companies would be comfortable with, whereas at the original price of $50 a month you'd be pushing 20 years just to recoup the capital investment assuming zero operational expenses beyond bandwidth.
Assuming CenturyLink has their fiber already running along the road (and if that is the case, what's stopping them from increasing the available bandwidth?), perhaps there is some way of forcing them to sell said fiber to someone who will push some more bandwidth down the pipe - it would save time and dollars from laying new fiber and might reduce the amount the town needs to spend.
Or if AT&T has fiber to the area, maybe they can hit 2 birds with 1 stone: reduce the overall cost of implementation by utilizing existing fiber (dark or wavelength if possible, maybe a 10-20 year IRU) and buying the bandwidth at the next cheapest place (probably Las Vegas NV?) and reducing the overall amount the town needs to spend in order to get decent broadband [yes yes, cue the AT&T overlords evil cackling].
I personally will be interested to see the result and/or how NI Solutions came to it's figures and/or what else would be involved with their implementation... I'd do it if I could make the numbers work.
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Re: Re:
We normally estimate 5-7 years for a full payoff (including the service) - if we're looking at $10k/mo for bandwidth (I don't know what the price of an interconnect is at Flagstaff but let's assume something like $50/mb/mo), so using your numbers you're looking at 200mb in to 1000 subscribers which is 200k per subscriber, which when contended - as consumer broadband is - is not bad.
And at $50 per month per subscriber, you're still only looking at ~43 months to pay off the infrastructure and break-even on the service (not including other OPEX, interest and whatnot, of course - expand it out and somewhere in the vicinity of 60-84 months would be a reasonable OTOH estimate).
HOWEVER, Wikipedia says there is only 554 residents, so it's safe to say only about 200 households at the most, which, assuming all else was equal, multiplies either the price by 5 times ($250/mo) or the payback time (up to 35 years). The alternative being that we estimate the cost of the wholesale connect to be less (say $2000/mo for say 50mb) but that doesn't make much of a dent overall: at $70/mo, you can spend $12k on paying back the infra and $2k on the bandwidth but you have a payback time of 142 months, which is probably longer than most companies would be comfortable with, whereas at the original price of $50 a month you'd be pushing 20 years just to recoup the capital investment assuming zero operational expenses beyond bandwidth.
Assuming CenturyLink has their fiber already running along the road (and if that is the case, what's stopping them from increasing the available bandwidth?), perhaps there is some way of forcing them to sell said fiber to someone who will push some more bandwidth down the pipe - it would save time and dollars from laying new fiber and might reduce the amount the town needs to spend.
Or if AT&T has fiber to the area, maybe they can hit 2 birds with 1 stone: reduce the overall cost of implementation by utilizing existing fiber (dark or wavelength if possible, maybe a 10-20 year IRU) and buying the bandwidth at the next cheapest place (probably Las Vegas NV?) and reducing the overall amount the town needs to spend in order to get decent broadband [yes yes, cue the AT&T overlords evil cackling].
I personally will be interested to see the result and/or how NI Solutions came to it's figures and/or what else would be involved with their implementation... I'd do it if I could make the numbers work.
Techdirt has not posted any stories submitted by Mathew.
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