Warsaw Fiber Follows Google's Example in Residential Service
Posted
Jordan Fouts-
WINONA LAKE – Warsaw Fiber had examples of what to do and what not to do when it decided to expand beyond business clients. The Internet service provider started in 2011 with only a handful of major business clients who needed dedicated fiber-optic lines, followed by a dozen smaller companies asking for mid-level service. After starting a three-year expansion of its capacity in July, with the aim of eventually laying over 100 miles of fiber-optic lines around Warsaw, the ISP is now rolling out a residential tier. “As a local company, we want to provide a good service – because we’re positive we can do it, and because there’s no reason to let corporate shareholders in some other part of the country control how much bandwidth you get,” said Tim Hori, company sales manager. “(Company owner Dean Avey) said let’s do it, we’ll provide a middle-ground for fiber connectivity. We had case models to look at, and no one else was willing to spend the money.” Fiber-optic communication involves the transmission of laser light over glass or plastic filaments the size of a human hair, laid underground in bundles of 144 strands. It has a longer effective range than typical copper wires but is more costly to work with. Hori observed streaming services like Netflix have whetted a growing appetite for bandwidth – the speed at which a computer can send and receive data through the Internet, usually expressed in megabits per second. Streaming music and video games also demand more speed as well as network stability. “People ask, how much bandwidth do I need? Inherently, you do need more bandwidth,” he said. “If you’re not getting a steady 10 to 12 megabits per second, you’re not getting enough.” Fiber-optic communication has been in use since the 1970s, and Hori noted some Warsaw businesses have been using the technology for 20 years. But attempts to offer residential fiber anywhere in the country in the pre-Netflix days often failed because the demand wasn’t there, he said, and because the monthly bill, priced to recover the billions spent upfront in installation, turned away potential subscribers. He said they’re instead modeling their service on Google Fiber, introduced in 2011 in Kansas City, Kan. (Nearby Topeka temporarily renamed itself Google in a bid to get the service first.) As opposed to the invest-first, recoup-later example, the model requires an established subscriber base before installing lines in a neighborhood. In Warsaw Fiber’s case this means requiring at least 35 percent of residences in an area expressing interest before the company will move in. Hori said a $50 preorder fee, which would eventually go toward installation cost, acts as a downpayment as well as a show of serious interest. “We want to see a real interest, not just people signing up because they thought it would be cool. They get some skin in the game. I hope people won’t spend $50 if they’re not serious,” he said. He said the monthly bill on a two-year residential contract is comparable to other providers’ plans, ranging from $65 to $120, with the top tier offering 300 mbps download speed and 60 mbps upload. New and potential users can see a map of Warsaw Fiber’s coverage area, about a four-mile radius from the center of town, with service areas color-coded: green zones are in the preorder stage, blue are fiber-ready and red are within the coverage area but not yet close enough to a hub for service. Hori said as the network develops, the red zones will turn blue and blue will become green. He also remarked that as local ISPs – once the common choice in the days of dial-up Internet – have been dying out or getting bought up, newly established service providers can only survive by breaking away from older models and decades-old technology. “The biggest problem with anybody trying to do one of the older models is market share vs. cost. It’s too expensive to deploy a new system of old technology and still expect to get customers,” Hori said. “The people being successful now are getting into fiber. They make the investment. It’s not a different version of what you’ve already got, it’s a better version.”
