Mar. 7, 2006 - If you missed BWE’s first article on "Building Wireless ISPs
in Rural Towns, Outlying Suburbs and Inner City Districts"
then you might want to read this one closely.
This article is the second in a serious of six articles that
are written for readers in rural areas, suburbs on the outside
of town or even inner city districts, where traditional service
providers have overlooked or purposely ignored their communities
because the return on investment was not considered attractive
enough by these companies to build out high-speed wired networks.
The good news is that wireless networks don’t require the high
capital expenditures mandated by wired networks, which can cost
hundreds of thousands of dollars to build. In fact, usually a
wireless network can be built that will provide high-speed wireless
Internet connections to 25-50 users for under $15,000.
The return on investment is quick and will continue to generate
revenue after the initial costs are paid off. For example, if
a small wireless ISP (WISP) can sign up 50 customers at $40 month,
it would take only take 5 months to break even. At end of 12 months,
most WISPs would gross around $24,000, with a profit of $9,000.
This is with only 50 customers.
A normal wireless access point or base station can usually
support 100-200 hundred customers, using over subscription
models that predict that only one out of every six customers
would be online at the same time.
If you lived in a neighborhood of 500 homes where no
broadband is available it should be very easy to sign up
customers. If you were able to sign up 200 customers at
$40 per month, suddenly you would have a business that would
be grossing $96,000 a year, which is great money for just
about anybody looking for a sideline business.
If these numbers are attractive and your interest has been peaked,
what is the next step? The next step really depends on a whole lot of
variables, which we will discuss one-by-one in the next 4 articles
that follow this one.
The first step in this process is find areas in your town where
no broadband is available. Obtain a map of your city and put a
thumbtack where every telephone central office is located. Then draw
a green circle with a radius of 18,000 ft. Each green circle represents
the area around each central office that might be able to receive
DSL service.
Next draw red squares on top of all neighborhoods know to have
high-speed cable modem networks.
Now analyze your map and look for areas with no green circles and
no red squares. These areas are called "Dark Zones" where no broadband
is available at all. These areas are the most ripe areas to harvest
broadband wireless customers.
Once you know where the Dark Zones are, then it is time to
determine whether or not you have enough potential customers
in your area that would sign up for service and pay the monthly
subscription rates you want to charge.
The most cost effective way to research the demand in these
areas is to print up door hangers with a marketing message that
says something like this, "We are considering building a high-speed
Internet network in this area, but we need 50 paying customers to break even.
If you are interested in this service, please call this number." If you receive
no calls, you should not proceed. If you get more than 10 calls,
you should investigate further.
One area that people don't plan for properly is the marketing
portion of their business model. Make sure that you assess advertising, direct mail, and public
relations campaigns before launching a high-speed
Internet service.
Please join us next week to learn, "
How to Select Wireless Antenna Sites for Your Town."
If you would like to read other articles in this series or an
expanded version of this article you can read them online at:
www.bbwexchange.com/howto/
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