[1st-mile-nm] Internet Access and the New Divide - NYTimes.com

[Steve Ross]

At current rate, for USA only, with Verizon almost out of the game, we're
doing 1.5 million a year of which 300,000-400,000 is Verizon Enhanced
Communities (PUDs and MDUs, not community-wide) -- my article on this
(based mainly on Mike Render's data after we corrected several errors) is
on the press now and should be posted at bbpmag.com later this week. If
capital were available AND below 11% we'd be doing 4-5 million a year among
non-RBOC deployers, judging from unfunded business plans I've reviewed (I
see a lot of them, especially since the financial calculators went live on
our site). As I think you know, Chris, Tim Nulty has some self-help
sweat-equity ideas as well. We're going to base several Broadband Summit
sessions on those next April. Will also have an entire track on an
open-access rethink -- a way from smaller carriers to offer a multiplicity
of modern services.

Right now, private funders (equity, vendor lease, etc) want coupon rates of
at least 11% and we've seen quotes at 15%. At those rates, networks can't
get funded, even in good times. One common complaint: "why isn't there a
futures market for broadband suppliers" so funders can hedge their risks
(as they do with electricity, etc). They worry that broadband ARPU will
collapse, whereas all we see are increased numbers of services deliverable
on broadband, and thus increased revenue, even knocking linear video out of
the equation (lots of revenue, not much margin anyway).

This stuff on futures is all investor nonsense, of course, especially
compared to alternative investments (zero interest rate at the bank,
near-bubble over-speculation in commodities). Bankers are both smart and
stupid, but even the smart ones have a herd mentality.

Munis have an especially serious problem. In most states, they have to sell
the entire funding bond at once. And tier3's without bankable assets going
for typical RUS loans have to borrow 20% from the bank up-front to match
the cheaper federal money. Raising $X up front at 15% and sticking it into
a bank at 0% for two years until you need it for the actual build adds 30%
to the network cost if you are a muni!!!

Steve Ross

On Mon, Dec 19, 2011 at 9:31 AM, Christopher Mitchell <
christopher at newrules.org> wrote:

> But without Verizon expanding FiOS, how long will it take to pass 25
> million homes?  I think this is the concern Crawford legitimately raises.
>
> Christopher Mitchell
> Director, Telecommunications as Commons Initiative
> Institute for Local Self-Reliance
>
> http://www.muninetworks.org
> @communitynets
> 612-276-3456 x209
>
>
>
> On Sun, Dec 18, 2011 at 10:57 PM, Steve Ross <editorsteve at gmail.com>wrote:
>
>> I admire her but her facts are  way off. Even at the height of the FiOS
>> build a quarter of all homes passed with fiber were passed by tier3 ILECs
>> and munis. In the past year, more than two-thirds were. there are now 22
>> million homes passed by fiber -- 20% of all households.
>>
>> (sent from mobile phone)
>> Steve Ross
>> +1 201-456-5933 mobile
>> +1 781-284-8810 landline
>> "editorsteve" on Facebook & LinkedIn
>> On Dec 18, 2011 9:02 PM, "Richard Lowenberg" <rl at 1st-mile.com> wrote:
>>
>>>  The article David is posting to this list was in the Times
>>>  two weeks ago, and immediately generated a lot of attention
>>>  and discourse.     If you haven't yet read it, take a look.
>>>  Susan Crawford is very smart and perceptive.
>>>  RL
>>>
>>>
>>>  From: David Breecker <david at santafeinnovate.org>
>>>  Date: December 18, 2011 2:40:18 PM MST
>>>  To: 1st-Mile-NM <1st-mile-nm at mailman.dcn.org>
>>>  Subject: Internet Access and the New Divide - NYTimes.com
>>>
>>>
>>>  Apologies if this Dec. 4 piece has already been posted; some very good
>>>  observations, IMHO:
>>>
>>>
>>> http://www.nytimes.com/2011/12/04/opinion/sunday/internet-access-and-the-new-divide.html?pagewanted=all
>>>
>>>  Increasingly, we are a country in which only the urban and suburban
>>>  well-off have truly high-speed Internet access, while the rest — the
>>>  poor and the working class — either cannot afford access or use
>>>  restricted wireless access as their only connection to the Internet. As
>>>  our jobs, entertainment, politics and even health care move online,
>>>  millions are at risk of being left behind.
>>>
>>>
>>>  David Breecker, President
>>>  SFIP | Santa Fe Innovation Park
>>>        Real Solutions/Wicked Problems
>>>  http://SantaFeInnovate.org
>>>  Abiquiu Office: 505-685-4891
>>>  Santa Fe Office: 505-690-2335
>>>  Skype: dbreecker
>>>  Twitter: @SantaFeInnovate
>>>
>>>
>>>
>>> _______________________________________________
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>>> 1st-mile-nm at mailman.dcn.org
>>> http://www2.dcn.org/mailman/listinfo/1st-mile-nm
>>>
>>
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>>
>


-- 
Steve Ross
Corporate Editor, Broadband Communities Magazine (www.bbcmag.com)
201-456-5933 mobile, 781-284-8810 landline
707-WOW-SSR3 (707-969-7773) Google Voice
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