COMMUNITY.COM

WHAT A COMMUNITY SHOULD KNOW ABOUT OPPORTUNITIES IN TELECOMMUNICATIONS

Bringing High Bandwidth to Everyone in the Community

June 28, 2000

TABLE OF CONTENTS

ACKNOWLEDGEMENTS
EXECUTIVE SUMMARY
INTRODUCTION
APPLICATIONS
   Telework or Telecommuting
   Call Centres: Virtual and Web- Enabled
      Market Opportunities and Trends
      Workforce capabilities
      Community capacity and the business process
      Call Centre Attraction Recommendations
   Tele-medicine
   E-learning
   E-Commerce
   Digital Library
   Entertainment & quality of life
EXPERIENCE OF OTHER FIBRE-TO-THE-HOME PROJECTS
   Origins of FTTH projects
   Services Offered
   Lessons Learned
PATTERNS OF ADOPTION
   Market Demand
TECHNOLOGY
   Fibre Optics
   Hybrid Technologies, Copper, Coax
   Wireless Technologies
PRICING
   Cost of Technology
REGULATIONS
FINANCING
   Financing a business plan:
   Financing the implementation:
      Pre-operational phase:
      Operational phase:
      Post-operational phase:
APPENDIX 'A': Definitions and Descriptions
ENDNOTES

ACKNOWLEDGEMENTS

This research paper incorporates the ideas and definitions of several authors listed in the endnotes. Planned Approach would like to thank and congratulate these authors for the fabulous work in presenting this information. I would also like to acknowledge the contributions of Debby Donovan and Corey Whitehead in performing research and writing some of the sections relating to e-learning, e-commerce, and the experiences of other fibre-to-the-home project. Finally, thanks to Communication Spectrum International, Ross MacPhail and Jim Senyi, for their research on call centres.

EXECUTIVE SUMMARY

Many high bandwidth projects have been led by 'technical specialists', not 'users'. The roll-out of high bandwidth has been slow because telecommunications providers are waiting for 'killer applications' or more demand for their services - they are often hesitant to invest in higher bandwidth to the home fearing that people will not use the capacity, or will not support additional cost for higher bandwidth, making it difficult to build a business case, especially in smaller communities. In some cases, it is easier to continue business as usual than investigate the market for high bandwidth. Communities need to lead new telecommunications initiatives by encouraging telecommunications use, with telecommunications providers becoming partners rather than leaders in projects.

Communities concerned with developing themselves economically and diversifying their economy need to educate themselves on the opportunities made available through the Internet, how it applies to them, and develop strategies to use the Internet as tool to increase the number and variety of jobs in their communities.

The Internet is an excellent economic development tool, especially for more remote communities. High bandwidth can provide opportunities in the following areas:

1. Upgrade the skill level of the population in remote communities through e-learning and potentially change the economic fabric of the community including decreasing the youth out-migration;
2. Provide services not currently available in remote communities such as telemedicine, and remote monitoring;
3. Develop and link tele-workers to larger companies looking for human resources and avoid leakage;
4. Improve e-commerce activities and generate new services within the community such as in transportation and information technology;
5. Increase entrepreneurship by educating citizens on internet-based service provision and identifying new business examples that can be developed through the Internet or as a result of expanding local activities on the Internet.

Remote communities need to get in the game and a toolkit may provide some basic information that will encourage communities to get involved. An increased involvement may in turn encourage more bandwidth-hungry applications and the upgrading of local infrastructures. Champions could be local economic development corporations, municipal governments, or a local Chamber of Commerce. This paper will provide a 'sample toolkit' providing some basic explanations and the activities that should be undertaken to begin the communities' involvement in the telecommunications sector.

INTRODUCTION

"The death of distance as a determinant of the cost of communicating will probably be the single most important force shaping society in the first half of the next century. Technological change has the power to revolutionize the way people live, and this one will be no exception. It will alter, in ways that are only dimly imaginable, decisions about where people work and what kind of work they do, concepts of national borders and sovereignty, and patterns of international trade. Its effect may well be as pervasive as those of the discovery of electricity, which led in time to the creation of the skyscraper cities of Manhattan and Hong Kong and transformed labour productivity in the home." (1)

Economic developers have an opportunity to utilize this new economic tool to develop their communities. This paper will explain how the technology works and why it is an important tool for the future development of communities, especially remote and rural areas.

Today, the service which attracts the most attention is the Internet and the World Wide Web (WWW). The Internet is a world where distance does not affect the price of communication - an inexpensive way to communicate. The Internet is a series of networks which has grown from the US Department of Defence and several universities which wanted to share information. The WWW, developed in 1989, brings multimedia to the Internet. It allows the display of colourful pictures, music, moving images, as well as text and data. The result of the WWW makes the Internet much more fun to use and look at, or richer in content. (2) However, richer content will require larger bandwidth than the common 28.8 or 56.6 kbits/s of today's modems.(3) ' The user needs an appropriate access device (high speed network using fibre, wireless, or other technology) to browse the information and invoke the functionality on the network. In other words, to fully benefit from what is currently available on the Web and what will be available in the future, much higher speeds are required.

In order to use the Internet, people have two choices:

1. Use a line leased from a telephone company or an Internet Service Provider (ISP). Customers are purchasing a set amount of time and the charge remains the same. The telephone company or ISP are banking that they can use their bandwidth to its maximum capacity and the customer may not be guaranteed that the communication will take place immediately if the bandwidth is shared, making the service cheaper than if the customer had a dedicated communication line.
2. Dial up to the Internet from a modem, which means dialling their local ISP and the Internet connection is carried on a leased line for which they pay a subscription fee to the ISP.

The Internet is becoming cheaper. Retailers are recognizing that they can attract more sales if more people are using the Internet. Three of the biggest retailers have announced deals with major Internet Service Providers (ISPs) to provide Internet access services at either very low or no cost. Kmart is linking with Yahoo to provide free Net access through a new ISP called BlueLight.com and America Online has inked deals with both Circuit City and Wal-Mart to provide 'stripped-down' Internet access. Jupiter Communications predicts that the number of US households accessing the Web for free will rise from 1.5 million today, to as many as 8.8 million by 2003. And while most analysts say major ISPs aren't threatened by the new trend, some smaller ISPs are moving away from the subscription-based business model in favour or one based on advertising revenues, commerce, and financial services. (4)

The number of PCs worldwide will exceed 100 million units in 2000. The poor bit rates and large delay times in the Internet and the World Wide Web (WWW) are the sources of many complaints. Most users are currently connecting with a modem at 28 or 56 kilobits per second. Those who have cable modems are connecting at higher speeds of up to 1 megabit or 1000 kilobits per second. The following table demonstrates the types of applications and their minimum and suitable bit rates for upstream (receiving information) and downstream (sending information) data transmission. The quality and content of an application running either at the minimum data rate or at a suitable data rate will be remarkably different. As an example, an electronic newspaper operating at 2000 kilobits/second (2 Mbit/s) integrates real-time streaming video and audio, and real-time block-transfer of other media such as pictures, text, and graphics. This is an attractive alternative for newspaper and for TV news since it composes with various media and adds interactivity. The same application at 28 kbps suffers from considerable delay time and does not allow the transmission of real-time streaming audio and video. The user might be disappointed by this kind of service. Downloading a film using a 56 kbps modem could take 8 hours, while over a broadband connection, only half an hour.

(5)

Future services and applications will require a faster technology especially bandwidth intensive applications like on-demand video (download an entire video to your set top box), or videophones with full screen full motion video. In addition, there will be more requirements from future office tele-workers (employees who are working outside the conventional office). Their requirements will include improved sound, the ability to send and receive videos, large data files, and the ability to quickly download software to their home computer. Subscription gaming sites will grow and benefit from the ability to stream multimedia content - with increased graphics-processing power in the near future, all kinds of simulations and games featuring richer detail and more realistic modelling.(6) The next generation of Internet telephony applications will allow users to make calls using a standard telephone and a centralized Internet connection, with the Internet substituting for the Public Switched Network (PSTN). (7)

Most facilities in the ISP industry are constructing long distance networks and are hoping that local Telco's (telephone companies) and cable providers will eventually produce a solution for high-speed local digital service to the home. Local telephone companies, cable companies, and other providers need to be encouraged and enticed by municipalities to make the move toward higher bandwidth to the home.

High bandwidth access has been increasingly provided to the business community and public sector organizations but the move to provide this service to the home has been slow. Banks were among the first in the e-commerce race to require high bandwidth to move financial information worldwide. Larger corporations have demanded higher bandwidth to conduct business with their suppliers (business-to-business or B2B). Many smaller retailers are now following suit, providing catalogues of their services and selling their products to consumer (business to consumer or B2C) located throughout the world. The public sector has also been using high bandwidth to test tele-medicine (provision of health services at a distance), e-learning (provision of educational programs at a distance), and to move information between government offices (government-to-government or G2G), or to allow consumers to use government information (government to consumer or G2C). The next wave is the provision of high bandwidth to the home, allowing people to access all these services from the comfort of their living room, and allowing people to start new businesses from their home office.

Benefits of high bandwidth to the home:

• New Ways to Work: telecommuting, even for high-bandwidth tasks. Internet-based businesses can be started in any home and in any Town. Disabled or homebound residents can work from home. People can stop commuting to work, decreasing traffic and parking problems.
• New Services: education and research is provided with live classes from anywhere. Library is accessible from the home. Medical practitioners can make 'house calls' without leaving their office. Entertainment is available when needed - people need not wait for the program they want to see.
• Better Communications: within the community, between homes and employers, worldwide. Better quality as well as quantity. Fast in both directions, people can be providers, not just consumers.

Many people talk about the benefits of the Internet but there is still a large problem: many people still don't know how to use it, and many communities are still not using the Internet for economic development. The first step in ensuring that the Internet is used in the community is to provide applications people can use. Approximately half of the Canadian population use the Internet according to a study performed by Angus Reid. If we want more people to use it, they need help to understand how it can be of use to them.

APPLICATIONS

What the Internet does best:

1. Electronic mail: sending messages, files, forms, paying electronic bills.
2. Finding information: making more information available for free in the public domain.
3. Telephony: using the Internet costs a fraction of the price of a long distance telephone call. The sound is not yet perfect and a digital telephone system is required, however, this service will grow in the future. Currently, students living away from home are using it heavily.
4. Personalized broadcasting: a low-cost way to deliver a new sort of cable television (viewers chose what they want to receive: channels and programs). Many people are receiving ‘web casting’, or live video pictures on the WWW (some are conferences broadcasted live or taped over the internet but it could be any television program or entertainment including a play or opera). ‘PointCast’ flashes video advertisement to users on particular subjects of interest (for example, you could chose to receive only car advertisements).

There are a great number of potential uses or applications for the Internet and the WWW, all requiring faster speeds than currently available to the home. The following is a list of applications which may be promoted and developed in a community:

• Telework: working from home for an employer located in another region, running a home-based-business selling goods and services to a region or the world, working from a subsidiary office for an employer located in another region.
• Call centres: a wired community could attract more call centres, and a virtual call centre project with employees working from home would have a competitive advantage over other locations offering standard service.
• Tele-medicine or tele-health: receiving health information or a consultation through a videoconference system, sending patient data to a specialist over the Internet for an opinion or assessment.
• Tele-education or e-learning: attending a college, university, or training program from home or a community classroom connected to any number of educational institutions. Attending a conference or a one-on-one training session from home or the office, while the trainer or conference is located in another region.
• Virtual libraries: the ability to browse through any library in the world, download books or articles, reserve and order books, talk to a librarian on-line from home, download a video available at the library.
• E-commerce: doing business on the Internet by developing a site where consumer can shop, pay bills, obtain information, register for a class, book a hotel room, etc.
• Entertainment: receive videos, music, games, or other forms of entertainment from the Internet to your home computer.
• IP Telephony: make telephone calls, with or without video (still or moving picture of the person you are calling), from a computer, through the Internet (avoiding long distance charges).
• Software access, data storage: allowing users to download a number of software from the Internet, sometimes free of charge. Allowing users to use a central memory located in another part of the world to store large files on a rental basis.

These applications may use one or more of the following technologies:

1. Digital video: largest potential user of bandwidth. A video is created with a computer instead of a film camera then sent over the Internet to the home user. The video is compressed using standards ranging from H.263 to MPEG-2 and can use from 56 kbit/s to 20 Mbit/s.
2. Digital audio and speech coding: music or voice is coded into the computer and sent over the Web. New audio standards such as Dolby or Sound Blaster Live enable more lifelike 3-D sound, which requires high transmission capacity.
3. MPEG-4: standard for coding audio-visual objects and will enable a whole spectrum of new or improved application including audio-/visual broadcasting, interactive mobile multimedia communications, videophone, videoconference, multimedia videotext, games, interactive computer imagery, sign language captioning, text-to-speech. Needs up to 15 Mbits/s for broadcast applications.
4. VoIP: voice over IP is a generic term that provides a telephone service over the Internet. It has not taken off because delays exceeding 250 milliseconds are unacceptable for quality performed of a telephone service and new technology must be provided to the consumer to transform an analogue signal into a digital signal. Many people are using this service today on the Internet to save long distance costs regardless of the quality of the call. (8)

Telework or Telecommuting

“Companies will be able to build new links not just with customers, but with employees in different parts of the country - or around the world. Employees in different countries or region will be able to work together in teams on the same project. But a bigger consequence will be the reduction in the size of firms in many industries. Computers and communications will allow companies to become networks of independent workers, specializing in what they do best and buying in everything else. Employees will, therefore, often work in smaller units or on their own.” (9)

The result of this outlook by Cairncross is

• More companies will be willing to locate in areas where they can get the best bargain in skills and productivity
• More people will work from their home or from multi-purpose small offices
• Companies will look for individuals interested in selling their services over the Internet since they can buy as little or as much as they need without having to hire people full-time
• New businesses will spring up to identify what customers need and ways to provide it. These will be suppliers providing services to one customer or many customers.

“Initially, teleworking jobs will be concentrated in large units. A bank no longer needs as many small branches once people can do more of their banking by telephone and by other electronic means; a travel agent no longer needs as many people in local offices. Such activities can be handled by a single call centre, which does not need to be located in a particular city. The activity becomes centralized, but the place of work can be decentralized. Some teleworkers will work from home. Various experiments have found a number of benefits in working from home. Foremost is more job satisfaction and lower stress…Tele-cottages may offer a solution to problems of cost and maintenance: these offices will spring up in many small towns, allowing a group of people to share high-quality communications facilities in one building. This will have the added benefit of overcoming the sense of isolation that some home workers feel.” (10)

Teleworkers use e-mail, phone and fax to keep in touch with employers and customers, and teleworking methods can be applied to any person whose job allows them to communicate and share information digitally. ‘Telecommuting is the partial or total substitution of telecommunications technology for the trip to and from the primary workplace along with the associated changes in policy, organization, management, and word structure. Simply put, it’s moving the work to the workers, instead of the workers to work. Computers, cellular phones, fax, and advanced communications links such as ISDN and dial-up access have removed the physical barriers that once required workers to be in their offices.’ (11) There are three different types of telecommuting:

1. Work at home: employee designates workspace at home to conduct business functions.
2. Satellite office: remote office locations designated by the company to reduce time and expense of commuting.
3. Neighbourhood work centre: workers of different companies are housed under one location and share the expenses of an office.

To the company, the benefits are:

• Recruiting: extends the geographic boundaries, makes the company more attractive with new and flexible work structures.
• Employee retention: accommodates dependent care responsibilities, saves recruiting and training costs, flexible alternatives to relocation.
• Office space cost.
• Productivity: increases by 10-30%.
• Absenteeism: reduces travel and geographic barriers, employee’s benefit mentally and emotionally.
• Environmental & emergency: reduces pollution, traffic congestion, and increases emergency effectiveness.

Work can be carried out wherever the appropriate skills are available at the optimum mix of costs and other factors. In some circumstances, recruitment costs can also be reduced, as can the costs associated with high staff turnover (attrition) rates. Staff can be on ‘standby’ time at home at retainer rates and then paid at higher rates when needed for active work. Teams with the best skills and experience for a particular project can be created, regardless of geography and time zones and with a minimum need for extra travel.

“Telework can enable people in an area of high unemployment to have access to work opportunities that arise anywhere worldwide. To take advantage of this, either the individual must have skills that are in high demand plus well developed personal skills in electronic networking that will bring their competence to the attention of appropriate employers, or the local community must take steps to establish itself with a high profile on the networks so that ‘distance working’ opportunities are generated for local people.” (12)Telework can also enable access to work, training and social interaction for people who have specific problems; for example, those with disabilities or single parents who need to be at home for the children.

Selection of telecommuters must be based on:

• Supervision and feedback: some work must be able to be done at home without feedback or approval.
• Social interaction: people need to keep in contact with others by phone, e-mail, or other means.
• Organization and time management skills: the employee must be organized to keep focussed on work.
• Self-motivation: workers must develop regular routines and set deadlines for completion of work. Successful telecommuters are people who can reward themselves for being productive.
• Performance: workers should be good performers.
• Tenure: employees who have been on-the-job a long time are naturally more familiar with their tasks as well as their co-workers and more likely to need less assistance or input.
• Employee status: a telecommuter should be a full-time rather than temporary employee. (13)

Nortel Networks already has about 600 participants in Britain and Ireland and is attracting new staff recruits at the rate of ten a week. The eventual aim is to make teleworking a major element of the company’s practice throughout Europe. In 1998, the company had over 4000 teleworking employees 40% were full-time and no longer retained traditional offices on Nortel premises and 60% were part-time. Their telecommuters reported 10% higher employee satisfaction ratings and 20% higher productivity than the general Nortel Networks population. In theory, about 20% of its employees (or over 15000) are seen as potentially able to telework. Nortel installs high-speed routers at the employee’s home office connecting phone, fax and personal computer to the public network through ISDN, and bridges team members regularly so they can share ideas and chat informally among each other. (14)

According to the US Department of Labour, the computer and data processing industry tops the list for growth in the coming decade at a 117% growth rate. The fastest growing occupations are (growth forecasted between 1998 and 2008): computer engineers (108%), computer support specialists (102%), systems analysts (94%), database administrators (77%), and desktop publishing specialists (73%). (15)

The next phase of the community.com project will need to identify the skills available in the community and the companies interested in hiring teleworkers.

Call Centres: Virtual and Web- Enabled

In assessing the potential for call centre and telework opportunities for the community, we need to focus on:

• Market opportunities and trends
• Workforce capabilities
• Community capacity and capabilities
• Business Decision Processes

Market Opportunities and Trends

The global marketplace has created incredible opportunities and challenges for private and public organizations. Organizations are looking for methods to manage customer relationships in the most cost efficient manner without jeopardizing quality in service. New technologies are providing opportunities to control costs while improving customer service. These new technologies are creating incredible opportunities for business, communities looking for new job opportunities, and individuals seeking careers. The current and emerging channels for managing customer relationships include:

Call Centres - centralized centres designed to provide resource to a private or public organization offering one or more of the following to customers:

• Provide general information
• Buy or place an order
• Book/schedule a call, visit, trip, appointment
• Receive personal information
• Place a complaint
• Secure or discontinue a service
• Make changes to current arrangement/services/policies
• Sell products and services
• Affect repairs or changes to software, equipment, etc.

Virtual Call Centres - home-based call centre operator services

Virtual call centres are defined as a number of representatives in geographically separate locations being treated as a single entity for the purposes of providing services to customers/callers. These services include but are not exclusive to call/inquiry handling, transaction handling, reporting, scheduling and managing. These representatives may be located at home, at a remote office, at a telecottage or in an individual call centre. The virtual call centre is seamless to the consumer so that geographically dispersed representatives appear as a single unit. Calls can be routed on a basis of skills and/or availability. This is critical when a central call centre is experiencing call-overload or requires skills and knowledge not available in the central location.

Outsourcing Market:

Outsourcing is continuing to grow in popularity. A company may sub-contract part of its operation to another company. Traditionally telemarketing firms have dominated the outsourcing market. Inbound customer service is the largest horizontal application for outsourcers with 41% of total outsourcing activity. Datamonitor report - Opportunities in European Call Center Outsourcing

Web-Integrated Call Centres

As the customer culture shifts towards electronic communication media, businesses need to provide new multi media channels of contact. While e-commerce is providing exciting tools, it is also creating confusion and concern. Customers often find sites technologically exciting but lacking in service. Organizations recognize that customers are only a click away from the competition or simply giving up. Providing an added touch to a web page by providing ‘concierge services’ or information attendants’ is a solution through web-integrated call centres. These centre provide the human touch to electronic service.

Web - integrated call centres have the potential to unlock online opportunities and revolutionize direct contact performance. They are ideally suited to handle help desk and sales order functions.

What does all this mean? The call centre business is growing and will continue to grow at an incredible rate. Consider:

• In 1998 there were 58,000 outsourced agent positions in the European call centre market. By 2003 there will be 127,000 outsourced agent positions in Europe.
• Call centre outsourcing market in Europe is currently worth $7 billion US with expectations it will grow to $15.1 billion US in 2003
• In Europe in 1998 there were 180 call centres as part of a call centre. That will grow to 1,230 call centres in 2003.
• The US will see an increase in centres, that will be part of a call centre, from 2,340 in 1998 to 8,970 in 2003.
• There will be a total of 3,650 virtual call centres in Europe and the USA by 2003.
• Of a predicted 17,900 call centres in Europe in 2003, 3,400 are set to be Web-Integrated. (16)

Workforce capabilities

High turn over rates for telemarketers and customers, and an over-capacity in the production environment causes firms to focus on getting someone else to make calls and sell their products/services on their behalf. This is often referred to as ‘out-bound’ call centres where the telemarketer calls a potential client to sell products or services. It is more difficult to retain people in out-bound call centres because not everyone likes to sell products and many do not accept rejection.

Communities often look for the ‘in-bound’ call centre, where the client calls in to obtain information on a product or a service, as a more favourable call centre. Operators are usually a little more skilled, and wages are usually a little better. However, if the ‘in-bound’ call centre is focussed on receiving complaints, the call centre operator’s job may not be better than the ‘out-bound’ call centre.

Availability of skills and a customer-oriented workforce is one of the key criteria in assessing the viability of an in-bound call centre location. Telemarketing firms are also looking for skilled representatives with sales orientation.

Communication Spectrum International (CSI) review workforce interest and capabilities and sometimes begin with an information session on the call centre industry and its opportunities. This session was designed to ascertain the number of individuals interested and to do a preliminary assessment of their capabilities. The information session provides an opportunity to gauge interest and the potential opportunities and barriers. Community surveys and other methods may follow to gauge interest and capabilities.

Barriers to attract call centres in a small community

One of the barriers to encouraging local residents to work in a call centre can be the perception left by other call centres. Outbound call centres, with their high staff turn- over, and their recruitment methods, can create a negative attitude towards call centres. Organizations that are looking to set up a call centre want a workforce and community excited about the opportunity. They want to be a key business in the community. This makes it easier to attract and keep representatives. If representatives are negative, they are likely going to create a negative perception with their customers

Opportunities to attract call centres in small communities

One of the keys to success is a highly bilingual workforce. Another asset may be good computer and basic business skills of people.

Community capacity and the business process

Locations that have been very successful in attracting a call centre make it easy for investors to establish their business in their Town. They have:

• A team in place
• Industry-specific marketing/collateral materials
• An individual who drives the process and is accountable
• A passion for making it successful
• Telecommunication infrastructure and details on technology available for call centres
• A call centre proposal format and process that is aligned to the prospects needs
• A business process designed to ensure a simple and efficient execution of all phases of the decision making process
• Call centre knowledge and skills
• Speed of execution
• Funding requirements defined and the process to execute this quickly and efficiently

Decision makers in organizations will have, for the most part, well defined decision- making criteria for a location (for example, a minimum population level, a bilingual population, a maximum long distance rate, etc.). If the basics are not in place, call centre decision-makers will never take it beyond the initial stages in a community.

While there is a desire and passion to bring a call centre to a small community, there are still major gaps. If an interested and motivated organization decided to assess the community as a potential location, the results would most likely be less than favourable if the right tools and actions are not in place. There is a need to develop the right tools, processes and people to ensure every opportunity for success. Simply getting a number of organizations to consider the community will create a great deal of work with little or no chance of success. Too many failures will create the wrong perception in the community and the marketplace.

Long distance costs may create a barrier especially if a call centre is routing calls from the international locations.

Given Canada’s multilingual, educated workforce, communities with language skills and located in a central time zone may be well positioned to be a predominant international call centre location. At this stage, work is required to create a positive perception in the community and to potential call centres.

Call Centre Attraction Recommendations

Attracting call centres has become a fiercely competitive business. Communities all over the world are conducting sales and marketing campaigns. Ireland has become known as the Celtic Tiger. South Africa is one of the fastest growing locations for call centres. If smaller communities expect to compete in this marketplace, CSI recommends that the following steps be considered.

1. The establishment of a community taskforce including an expert on telephony infrastructure, a member of the Town Council, business community representation, representation from a Consultant with good community experience and knowledge in the telecommunications economy.
2. Development/enhancement and implementation of a call centre attraction and marketing plan including collateral materials (marketing materials, workforce capability reports, facility availability, etc.).
3. Development/enhancement of an attraction/implementation process that defines every step, and requisite accountability from initial contact through to opening ceremonies and follow up support. Make sure that the right people and processes are in place to make it so easy to do business with and in the community.
4. A Consulting firm providing lead generation and sales cycle executions on an as needed basis.
5. Development of a process to accelerate any funding applications.

Tele-medicine

The use of telemedicine allows for maximum utilization of limited resources - a distant emergency department can get immediate assistance from an orthopaedic surgeon. The linking of health centres, medical departments, and remote clinics has proven to be a cost-effective way to maintain quality health care across a distributed health care system and to the most rural and remote communities. Second opinion consultation, a means by which physicians based at one site can obtain consultations from experts at other sites, allows patient care to improve and physicians to learn from one another.

Teleconferencing capability allows medical education with any expert worldwide. “Physicians are often placed in a precarious situation when a distant health care worker calls by telephone to ask ‘a couple of quick questions’ about a patient. Many of these calls result in unnecessary patient referrals and transports because the specialist remains uncertain of the true condition of the patient. By linking the referring clinician and the specialist through video conferencing, the guesswork is taken out of many of these cases.” (17)

Telemedicine utilizes information and telecommunications technology to transfer medical information for diagnosis, therapy, and education. The information may include medical images, live two-way audio and video, patient medical records, output data from medical devises and sound files. The telemedical interaction may involve two-way live audio and video visits between patients and medical professionals, sending patient monitoring data from the home to a clinic or transmitting a patient medical file from a primary care provider to a specialist. The growth of telemedicine over the next five to ten years may have a profound and revolutionary effect on the delivery of medical care throughout the world. Hub and spoke systems are now linking into broader networks, expanding their reach and effectiveness. (18)

The promise of telemedicine is providing significantly improved and cost-effective access to quality health care. The potential of telemedicine is helping to transform the delivery of health care and improve the health of millions of people throughout the world. Successful telemedicine programs support clinical activities, distance learning, and continuing medical education programs. Because of a severe shortage of healthcare professionals throughout rural areas there is clearly a need for this type of network and its services. In the future, the following applications of telemedicine will be a focal point:

1. Telemedicine as an export service: for communities rich in medical services, they will be able to sell their expertise to rural and more remote areas.
2. Homecare: with the aging population, tele-homecare has one of the greatest potential for rapid growth worldwide. The home monitoring industry has developed electronic and telecommunication equipment which enables medical care to be provided using telemedicine techniques rather than relying on in-person care to patients in their home.
3. Internet: will become the vehicle for the delivery of medical care in the next five years providing consultations, diagnoses, treatment and delivery of prescription medications all on-line usually with the consumer paying for the services by credit card. (19)

Telemedicine uses a variety of technologies including ISDN, T1, ATM, DSL, Satellite, Microware, digital wireless, local wireline, and the Internet. For remote patient monitoring, the cost of some monitors is now less than US$300 each, but transmission cost is an issue. Medical specialists in dermatology, oncology, radiology, surgery, cardiology, and mental health are starting to use telemedicine extensively for the following:

1. Tele-radiology (mostly in-hospital use)
2. Patient monitoring (mostly at home use)
3. Correctional care
4. Service provisions to remote communities

The leading applications today are:

• Psychiatry
• Emergency Medicine and Trauma Care
• Dermatology
• Cardiology
• Surgery: connecting a colleague or mentor during an operation
• Pathology
• Medical education

There are at least three good opportunities for home tele-health:

1. Provide more services more frequently than is possible using conventional visits;
2. Help patients, through frequent reiterations of routine needs and reminders, learn how to better self-manage after they are discharged from home care and are on their own. The patients, by undertaking more and informed self-management routines will have become part of the solution for financing their home health care;
3. Deliver a range of services through tools that are simple, inexpensive, and familiar to the patient. A touchtone telephone may be the highest tech piece of equipment required for telehealth contact. (20)

LifeChart.com is an example of medical programs offered to the home. A medical-monitoring system lets subscribers take readings on a monitoring device and upload results via a phone line to a confidential database. Caregivers and medical personnel can access the information via a password-protected, secure Web interface and immediately view the effects of medications and track their performance. The online medical-monitoring services will let patients and caregivers actively manage an illness and gain a more precise picture of a patient’s health. In California, about 5000 individuals pay $10 each month to monitor diabetes, heart and lung conditions. Companies review patient data and if it indicates that someone is at risk, alert the doctor, caregiver, or patient via fax or e-mail. LifeMasters uses the web. Patients enter their data online and get personalized health information from doctors and nurses. This information can be passed on to regular caregiver and doctors with the patient’s permission. A nurse makes regular contact with the patient by phone or e-mail and outside of this, if a problem is detected, the monitoring nurse receives an automatic computer alert. The nurse then contacts the patient to discuss his/her condition. “Say you have an aging diabetic mother in Florida and you can’t check in with her daily, online monitoring eases worry all around”. Most people are likely to hear about innovations from their health care provider and medical institutions need to sell these services to doctors and their staff. (21)

E-learning

Think of what it could mean if students (young and old), could remain in their community and obtain college and university programs. E-learning will be an important tool to quench the out-migration of youth toward larger centres. It will not stop it, as young people still want to get away from their families for a while; however, some cannot afford to leave, and others are not ready. Given the strong influx of youth forecasted to enter our colleges and universities until 2010, e-learning will become a way to manage the large numbers needing post-secondary and graduate programs.

A recent government study in the USA of 1601 colleges and universities and other post- secondary institutions indicated that 34% of institutions offered distance education in 1997/98 and another 20% were looking at offering it within the next 3 years. By 2000/2001, more than half the schools in the US intend on having distance education. Between 1995 and 1998, the number of courses offered doubled from 25,730 to 52,270 and most of these courses where college-level and offered credit. Enrolment also grew from 753,640 in 1994/95 to 1.6 million in 1997/98. 82% of schools that offer or soon plan to offer distance education said they intend to provide classes primarily through ‘asynchronous’ Internet instruction, meaning through e-mail and the Web. The second most popular method, cited by 61% of schools, was a two-way video link. Close behind at 60% was ‘synchronous’ or real time instruction over the Internet, using technology like online chats. (22)

Several new knowledge ventures are uniting some of the most prestigious universities and cultural institutions world wide to address the greatest challenges in distance learning. Fathom is working on the development of a new category of knowledge on the Internet: "E2C" or "Education to Consumer". Fathom will offer its courses as well as courses from other colleges and universities. It will extend beyond traditional course by integrating content from museum exhibitions, lectures, reference books, interviews and documents. The site will feature 'knowledge creators' -- curators, researchers and professors who carry expertise from 'world-renowned institutions that carry ‘instant credibility'. A select Council of academics, to ensure that it meets academic and editorial integrity standards, will authenticate all original content on the site. While much of the site will be available at no charge, some courses and books will be made accessible for a fee.

Another example is the University of Maryland with campus-free bachelor’s degrees in a number of subjects. Most universities are experimenting with distance learning or figuring out how to get into the exploding field. Meanwhile, billionaire Michael Saylor donated $100 million toward an ‘Ivy League-quality’ on-line education system that would include lectures from the world’s geniuses and leaders videotaped and made available through a non-profit university acting as a ‘cyber Library of Congress’. (23)

Athabasca University in Alberta has established itself as a front-runner in delivering distance programs. Their courses are accessible through the Internet in the disciplines of health, technology and business. The varieties and options are increasing on an ongoing basis. Athabasca also partners with the University of Quebec, which offers on-line programs through its Télé-Université. Canadian universities have formed an alliance to improve their delivery of courses and programs on the Internet.

Colleges and universities have had a push on wiring dorms and providing 10 Mbps access to students. The students are using connections for music files, instant messaging, toll-free phone calls, e-commerce, games, and digital movies. The students are finding it difficult to revert back to slower connections. This may become a ‘quality of life’ issue for communities looking at attracting young people. Although about 2 million households now have high-speed Internet connections, about 7 million college students now have high-speed access through their schools, according to Jupiter Communications. School administrators say students often base housing decisions on Ethernet availability, and incoming freshmen sometimes decide whether to attend a school based on high-speed access. (24)

E-Commerce

Online commerce, referred to as e-commerce or e-business, is a unique way of doing business on the Internet. With E-commerce, companies can conduct business through the Internet 24-hour per day, 365 days per year. E-commerce allows a company to display its products and services on the Internet as well as perform related financial transactions. It enables companies to be more efficient and flexible in their internal operations, to work more closely with their suppliers, and to be more responsive to the needs and expectations of their customers. It allows companies to select the best suppliers regardless of their geographic locations and to sell to a global market.

The majority of companies recognize that in today's competitive world of business, a site on the World Wide Web can be a valuable way to boost sales, enhance customer service and market to prospective customers.

Every financial transaction at some point turns into an electronic process - the sooner it does, the more cost effective the transaction is. Automation saves the businessperson valuable time, and time saved for business allows for an increased number of transactions and increased profits.

E-commerce provides the mechanism for buyers and sellers to do business. Very simply, sellers post the description of the products / services they are wanting to sell, including specifications such as pricing, shipping information, graphic or picture of the items. Potential buyers search the many sites and postings and make contact with the seller. E-commerce facilitates bringing buyers and sellers together.

Today, E-commerce is being used in everyday life, and yet many people fail to recognize this: a credit card authorization, travel reservations through agencies, wire funds, retail Point of Sale terminals, electronic banking, centralized payroll processing are all examples of e-commerce.

E-commerce for private sector essentially has at least two facets: Business to Consumer (B2C) and Business-to-Business (B2B). B2C are consumer oriented retail service/product transactions while B2B consist of transactions between businesses (wholesale market).

B2B is an extremely diversified field and can take many forms. A practical example: the purchasing department of a company can post its requirements online, with an extended forecast on their possible future purchases. This would enable all the suppliers who visit their web site to bid on the firm's purchasing requirements thereby creating more competitive / lower prices.

B2B e-commerce has already surpassed the business to consumer market by a long shot. Annual B2B e-commerce is projected to soar from $43 billion in 1998 to $1 trillion by 2003. According to Forrester Research - it was virtually a $0 business in 1990. The consumer market, on the other hand, will increase from $7.8 billion to $108 billion in the same period. A 'middleman' in the B2B market, known as "infomediaries" is predicted to become the fastest growing and most profitable business model in the Internet area over the next 3 to 5 years, according to San Francisco-based tech-focused investment firm Volpe Brown Whelan. Infomediaries employ a variety of mechanisms to generate transaction fees for their clients, including: auctions, matching buyers and sellers through request for proposals / quotation services, and direct sales of merchandise.

Another option is available for the business that is interested in placing its products / services online, without great expense or the worry about day-to-day management and operations of the web site. Cybermalls are appearing with increased frequency on the Internet, whereby a number of companies' products and services are featured by means of a "mall environment" with all types of consumer goods for sale, from cakes and wines to computers and motor vehicles.

In conjunction with the increase of E-commerce utilization the practise of using "digital wallets" (E- wallet) has been stepped up. An E-wallet is a portable personal profile that allows consumers store their ‘ship to’, ‘bill to’ and credit card information in one secure place. Once this is accomplished, the consumer will no longer have to re-enter this information at every site where he places orders - the digital wallet fills in the required information. The use of digital wallet features will allow merchants to offer simple, quick shopping for its consumer, will handle customer services, will allow for predictive marketing to help target customers, will offer anonymous customer profiles with detailed demographic and behaviour information.

It is evident that e-commerce can mean a variety of things to different people. As identified in the introduction, it can be retail stores selling to customers through the Internet; it can be the Town residents purchasing a permit through the Internet.

Another element in e-commerce development will be the need to bring the Town’s municipal services on-line and provide citizens the opportunity to find out what is going on in the community at any time, register children for activities, or pay a ticket, a tax bill, etc. Connect Ontario, a new provincial program whose mandate is to develop 50 Smart Communities within the next 5 years in Ontario, Canada, is allocating funding for community ‘portals’ which would place all community resources through one façade on the Internet. All e-commerce services would therefore fit under one portal or one Internet web page and the Connect Ontario program could cover some of the developmental costs.

Digital Library

NEC Corporation has developed the first world’s network-based virtual library called the Universal Digital Library. It utilizes ‘walk-around’ and ‘virtual agent’ technologies to provide an advanced three-dimensional graphical interface that almost convinces users they are browsing through a real library. While the ‘walk-around’ technology gives users the ability to roam through the Library (user looks at the screen an the 3D effect makes him/her feel as if they are walking through it in real life), ‘virtual agent’ technology lets users interact with an animated virtual librarian for information, such as directions inside the library, or the location of a book. Many countries currently have plans for the introduction of Global Information Infrastructure (GII) and Fibre-to-the-home (FTTH) to construct the high-speed networks necessary for such multimedia services. A digital library is one of the developments most widely expected to take advantage of such capacity.’ (25)

Entertainment & quality of life

Television will change, with several hundred channels, the ability to receive any video a person wants at any time, and the ability for anyone to make a movie cheaply and distribute it over the Internet. People will be looking for television/video programs and games that suit their taste and needing higher bandwidth to receive them. Australia is running soap operas cheaply over the Internet filmed at a London office, Germany is opening a channel for companies to use for pep talks with its employees.

Time Warner in Florida hooked 4000 families to a service offering home shopping, movies on demand and video games. The video-on-demand has not proven itself and has been very expensive to deliver. The near-video-on-demand (subscribers call in to order a movie and it is sent to the set within a specified timeframe) offered by digital satellite providers have proven to be a rough-and-ready way of persuading viewers to spend more on movies without requiring the investment required by truly interactive television (fibre-to-the-home). Once the costs decrease, video-on-demand will become more marketable.

In the meantime, other services such as those requiring interactivity, will become popular and require higher bandwidth. For example, children will be able to watch adventure stories and change the plot by switching channels. Television games that allow groups of subscribers on different parts of the network to play against each other will become more popular and require higher bandwidth. Programmers are delivering high-immersion, interactive games in which players show up as video rendered versions of themselves inside computer-generated environment. The first commercial example of this new immersion technology, sometimes called ‘Video as Input’ (VAI) has been launched. A computer equipped with special software interprets signals from the video camera and tracks the player’s image (the player’s face is pasted on the action figure). Combined with high speed Internet, the technology could have significant applications in education, health, and business.(26) Already, this technology is being used in hospitals to enable sick children to attend school. The child controls a robot located in the classroom from his/her hospital room. The child’s face is broadcasted on the robot’s face and the child is able to see and hear what is going on in his/her classroom, and control the robot to raise a hand to ask a question, or turn the robot’s body parts to focus in another area of the classroom.

Always Independent Films (www.alwaysif.com) offers over 375 movies and trailers. It is one of at least two dozen sites showing films as filmmakers flock to what could be a means of bypassing Hollywood and reaching viewers directly.

Home-based services will include monitoring of the housebound sick or elderly, and repair of machinery without a home visit (repairs are done from a computer located in another Town or country). Home monitoring services will provide a higher level of security monitoring for the home. All distance monitoring will become available when homes have a permanently open telephone line or a computer with a camera attached online. This will allow people to keep in touch with an elderly person located anywhere on earth, avoid the costly time required to wait for a repairperson, and allow the homeowner to check on his/her home while abroad.

Advances in digital video technology have made it possible for professionals and amateurs to produce slick, sophisticated videos on their desktop computers. Five years ago, this technology for videotape editing would cost a station over $1 million, now, a broadcast-quality PC based editing suite can be set up in the home for less than $30,000. In the very near future, some individuals will provide spot news to a neighbourhood or a whole city. Shoot the images from a camcorder, edit them on a desktop computer, upload them to a server connected to fibre optics and a new TV station is running on a budget of less than $3,000. (27)

EXPERIENCE OF OTHER FIBRE-TO-THE-HOME PROJECTS

There are numerous communities around the world that have undertaken “Fibre-to-the-home” initiatives with the purpose of creating infrastructures that will ensure their citizens have the technological tools to thrive in a society that is continuously becoming more reliant on computers and the Internet. These communities include the likes of Canberra, Australia; Palo Alto and Davis, California; and Ennis, Ireland. Many other communities in the USA are implementing this type of initiative. Sweden is attempting this feat for the entire country!

Communities, that have already installed some type of community network, have the potential of providing a wealth of information for those who wish to follow. For instance, by looking at the previously mentioned communities, project managers will gain some insight into their origins, services provided, and also be the recipient of any advice or lessons that experience has provided.

Origins of FTTH projects

There appear to be two main scenarios for project start-up:

• A major utility company is interested in a “test bed” for FTTH technology and approaches a community or number of communities.
• A community realizes that it needs to upgrade its current telecommunications infrastructure and therefore decides to install one that will stand the test of time and provide services that will be in demand in the future.

All four of the communities mentioned earlier fall under these two scenarios. For example, in the cases of both Ennis and Canberra, a major utility provider was looking for a community in which to test its technology.

In Canberra, ACTEW, the regional hydro company, was looking for an opportunity to break into the communications industry and the community seemed like the perfect fit as they previously had no infrastructure that could sustain “Smart Community” applications because the city’s lay out made building the infrastructure too difficult. As technology developed and became less expensive, Canberra became the obvious choice, as its citizens are very technology oriented.

In Ennis, it was the telephone company that was interested in a scenario where a community would become the “most wired” community in Ireland. The telephone company held a contest in which any community having a population between 5,000 and 30,000 could enter. The phone company would then select the winning community and consequently allocate the equivalent of $30 million Canadian to “wire” the winner. Ennis entered and made an approach focused on people, not technology. The committee which represented the town stressed how the technology would increase the standard of living in this isolated rural community where many of the residents previously had no telephones. As a result, the town won the competition and is now Ireland’s only “Information Age” community. The funding was allocated for infrastructure build-up and several years of operational funding.

The story of the Davis Community Network is similar. The University of California, and the Davis and the California State Departments of Transportation, were interested in the development of mobility through the electronic highway. The goal was to create a test bed community network in Davis that could support telework, tele-shopping, e-learning, and telemedicine. The project team was especially interested in the use of multimedia and video conferencing as a new transportation mode that would see people work and shop without having to leave Davis.

Palo Alto realized that it would need a new communications infrastructure in order to stay competitive and up to date with other California communities. The City, therefore, decided to pursue a “Smart Community” initiative. City council approved a motion to install a fibre optic infrastructure. The community then had the local electric utility build and manage the infrastructure.

It is important to note that although not all projects originated the same way, each community had a major partner (usually some sort of utility or service provider) to build the infrastructure and cover some if not all of the associated costs.

Services Offered

The most common and immediate services offered by “Smart Communities” include advanced telephone services (e.g. voice mail, caller id, etc.) and high-speed Internet. The reason that these services are readily accessible upon the infrastructure completion is that they require little or no outside partners. The owner of the infrastructure, whether it is the community or utility company, essentially becomes the Internet service provider by virtue of owning the lines.

In communities such as Ennis, Ireland, where many of citizens did not have basic telephone applications, the first priority was to install and promote the use of more advanced telephone and computer applications. Computers were installed in every home and school, and basic training was provided. The people of Ennis currently use their technology to:

• Keep abreast of community events and activities via a web page.
• Use the Internet as an educational tool.
• Promote the community and its attractions over the Internet.
• Access ‘digital’ newspapers.
• Promote business products and services.

Now that the citizens are familiar and comfortable with the technology, the community is seeking partners and applications in the areas of tele-working, tele-education, and tele-medicine.

In other communities such as Canberra, Australia; Palo Alto, and Davis, California there was already wide spread Internet and computer use. In these communities, the citizens were able to install more sophisticated applications at a faster pace. Examples of these more advanced applications and services include:

• Residents of Davis purchased their audio and video equipment by looking at an online catalogue from a store in a neighbouring community.
• Teachers use the system to post homework assignments, provide online educational materials, and communicate with parents.
• Students who are ill can also keep up-to-date with their studies with the Internet.
• People can enroll and take distance education courses from Colleges and Universities.
• Citizens can obtain permits and applications from city hall via the Internet thus reducing congestion and waiting time.
• Some citizens in Palo Alto work from their homes using the Internet and telephone lines (tele-working).
• Citizens keep abreast of community events and activities from a community website.
• People of the communities obtain medical information and advice from health-care providers by using the Internet.

Communities are continuously working to develop more partners in industry, healthcare, and education in order to ensure their citizens are able to receive the best resources possible without having to leave the community.

Whether all applications are immediately accessible or not, it is the ultimate goal of each and every “Smart Community” to make the most beneficial of the applications feasible in the near future. It is these applications (tele-medicine, tele-education, tele-working, tele-shopping), which will, in fact, allow the community to prosper and thrive in the global economy.

Lessons Learned

The infrastructure, costing, partnerships, and other issues can all be determined with the aid of consultants and engineers. Insights on how to ensure favourable community response and usage rates, however, are more easily obtained through the experience of others.

Many of the following points seem obvious; however, when the main concern of the City is to develop partnerships and install the infrastructure, many of these ‘obvious’ points may be overlooked. It is important to remember at all times that the citizens of the community are the people who will determine the success of the project. The following are recommendations made by other project leaders:

• For a community to be transformed, the project must provide effective tools to solve the community’s problems and meet its needs.
• The success of the initiative lies in the enthusiasm and involvement of its citizens (keep them excited, use contests, demonstrations, etc.).
• Partnerships must be developed in order to coordinate training and consulting support for citizens (they must know how to use the technology, and realize its potential).
• People must be informed of what they need to do to make the project and its impact as positive as possible.
• City ownership of the infrastructure seems to be attractive to residents, but can be daunting for the City staff and Council (adequately educate City staff and representatives).
• At times, progress may seem slow, people may not be taking up initiatives as quickly as you would like. Remember, the citizens have other things in their lives besides the “Smart Community” agenda.

By taking the lessons learned from Davis, Palo Alto, Ennis, and Canberra, Iroquois Falls is increasing its chance of a smooth transition into the technological age.

PATTERNS OF ADOPTION

The way people adopt new technologies will be influenced by culture, convenience, and cost.

Culture: If people are used to doing things one way, they may be slow to change, especially if they are over 65. Younger people are more adaptable to change and can become a force to help those more wary by providing their skills and knowledge and training older users of the technology.

Convenience: The more effort it takes to master the technology, the slower and more limited its diffusion will be. The personal computer is already a deterrent to utilization. The project will need to find ways to make information easy to access and use.

Cost: The Internet has flourished since costs have declined. Already, some residents are asking if there will be a subsidy toward the purchase of new computers and equipment. Although many residents are willing to pay more for high-level services, they are concerned over keeping costs low.

Market Demand

The main question in introducing new technology is ‘do people want it and are they willing to pay for it’. To this end, a survey of 600 residents of the Town of Iroquois Falls, Ontario, Canada was performed to identify the interest of residents in high bandwidth and their willingness to pay for the service. Iroquois Falls is a small remote community of over 5000 people, dependent on the forestry industry, and potentially needing the geographic barrier-free opportunities offered by telecommunications and the Internet.

Survey background:

A stratified random sample of 600 citizens based on the following distribution:

1. 75 distributed to the business community, handed in the downtown core and picked-up later by the distributor;
2. 75 distributed in three residential areas known to have a fair number of elderly citizens. Students were available to answer questions, however, most dropped the survey and returned to pick it up later in the day;
3. 200 distributed at the site of the community’s largest employer, handed to employees when they reported to work (600 total possible employees). The return rate was the worst from this group;
4. 50 distributed at community meetings;
5. 200 distributed to all high school students to bring home for completion. The return rate was also not very good with this group.

The objective was to obtain only one survey per household, and ensure a response from youth, seniors, workers, and the business community. Any duplicate surveys were eliminated based on the residence address, telephone number and name similarity. At the time of this report, 150 surveys, or 25% of the sample, had been received and entered onto a database. This is not an ‘ideal’ and ‘reliable’ survey given the distribution and return rate, however, the preliminary information retrieved may indicate some trends and topics for future study.

A smaller second survey of 100 residents was performed during a community meeting with 100% return rate but there were large variations in some of the findings when compared with the first larger survey. The attendees were asked three questions:

1. How many had a computer?
2. How many were on the Internet?
3. How many were interested in getting on the Internet?

Results of survey #2:

Homes with computers: 67%. This compared to 80% on the first/larger survey.
Homes on the Internet: 44%. This compared to 65% on the first/larger survey.
Both surveys indicated a higher than national average number of citizens with computers and on the Internet.

Survey Assumptions (prior to administration):

1. The average number of households who own a computer will be smaller than the national average based on the remoteness (lack of knowledge of what the Internet can do) and the fact that the community is dependent on one industry (people may not need or desire the Internet as much given the educational level, and the greater interest in the outdoors);
2. There will be a smaller number of people with an internet account (based on a perceived lack of service and interest in the Internet);
3. People with an Internet account will use mostly e-mail, surfing/research, games, and shopping and not more advanced or newer features of the Internet;
4. People will mostly be interested in obtaining Internet-based services that are not currently available in the community such as shopping, tele-health, and e-learning;
5. The average computer will be old, a full replacement will be required by the majority of the population in order to access new broadband services;
6. There will be a large number of people with little ‘computer and Internet skills’, wanting and needing training. Those needing less training, such as youth, can help to train others needing more training.
7. Given the fact that the community has suffered severe downsizing, citizens would be more interested in the business opportunities available on the Internet.

Results of survey #1: In many instances, the results of the survey were surprising and contrary to the assumptions made prior to its administration. This serves to indicate that there are many false impressions and additional research is required to better understand the consumer, his/her habits and the utility made of the Internet, and the interest of consumers in its future use.

1. The top 10 applications being used in the community demonstrate a relatively high level of sophistication in using the Internet in smaller/remote communities. The top 5 uses among respondents were: 75% use e-mail, 55% conduct research/surf, 55% use the internet for long distance telephony, 52% download music, and 35-40% access magazines, directories, maps and other reading materials on-line.
2. The top 10 applications most in demand demonstrate an interest in new ‘gadgets’ (videophones, videoconferencing), an interest in e-learning, and tele-health. Among the top 5 ways people want to use the Internet are: 75% want videophones, 66% want to access training seminars, 65% want to try videoconferencing, 60% want to be able to consult a physician on-line, and 59% want college and university programs on-line.
3. The top 10 application least in demand demonstrate that people are least interested in using the Internet to conduct business. Among the least favourite activities were the opportunities relating to tele-work, home-based call centres opportunities, starting a home business, publishing/writing on the Internet, paying bills and access community services. This has an impact on economic development opportunities afforded by the Internet, and may mean that communities need more information and ‘good news’ stories about home-based businesses and tele-work before these applications can become ‘in-demand’ in our communities.
4. The technology in homes is relatively up-to-date with approximately 60% of the population who have up-to-date computers (less than 2 years old), and 65% have modems and Internet access. Another 12% of respondents were prepared to purchase a modem and Internet account, and 23% were not interested at all. More than 60% of those who had a computer had purchased it between 1998 and 2000, therefore, computers were relatively new and many may not need major upgrades in order to access the planned new broadband services. However, respondents were reticent to investing in additional gadgets with 55% indicating they were not interested in an Internet camera, and 43% not interested in upgrading to include audio. This is contradictory to their interest in videoconferencing, tele-health, e-learning, and video-phones. It is possible that citizens will need an incentive to purchase additional hardware probably due to the large layoffs that have occurred in the community over the last year. Almost all of the respondents had an IBM compatible computer.
5. The knowledge of the community was much higher than expected with 70-75% of respondents having ‘good to excellent’ PC and Internet skills, and those with more knowledge were more likely to want more training. Those with the least knowledge were least likely to ask for training. This may point to a need to find alternate ways of training people, new ways of attracting people to training activities. Perhaps this could include one-on-one sessions with younger people instead of classroom sessions to make training activities less threatening. 16% of those responding indicated ‘poor’ PC/Internet skills (a scale was provided allowing respondents to measure their skills against a defined standard), 38% of these indicated an interest in additional training. 37% of respondents indicated ‘good’ PC/Internet skills, 44% of those had an interest in training. 35% of respondents felt they had ‘excellent’ PC/Internet skills, 58% of these wanted additional training. The more training provided to users, the more demand for training. It should also be noted that the response rate may be skewed with more people having good computer skills filling out the survey, while those with less computer skills, choosing not to respond.

Based on historical lessons learned from marketplace experiences with the radio, TV, VCR, computer and other technologies, John Carey provided the following important points:

1. People respond to price. The introduction of new technology usually carries a high price and early adopters are usually wealthy individuals, people with an insatiable desire for the product/service, individuals who love electronic gadgets, and business or schools who need the product. Early adopters are often male with higher income, households with home offices, and households with moderate or high income and children.
2. Industry is often looking for a ‘killer application’ before introducing a product. Although telephone and cable companies may be looking for a magic bullet prior to introducing a service, it is more often demonstrated that a confluence of factors will bring demand for a product/service. For example, the fact that consumers need the product to access jobs, the market, a medical service, or more education. The need for a mix of uses will bring demand, not necessarily one single ‘killer application’. This was true for cable TV when national cable program distribution became easier through new technology, new channels were created, and franchise awards were provided. All of these factors together spurred demand for the service.
3. Technology adoption will follow several distinct steps and the adoption steps will change over time, requiring a dynamic group able to respond to change. Once the first step in done, reaching early adopters, the group introducing the technology should try to anticipate the future mix of users and the use they can make of the technology. This is difficult but required to prepare for a shift in strategy. For example, the early adopters/first users may use the technology to become teleworkers and in this case, will need good download speeds to receive documents from head office. The second generation users, on the other hand, may provide training programs over the Internet, in this case requiring higher upload speeds to send larger documents to students.
4. The growth of some technologies is linked to the purchase of other media. The replacement cycle for existing media can provide an important way to introduce new media. The introduction of the Smart Community project will increase demand for computers, computer service, and a host of other products such as computer tables, new telephones, new telecommunications connections, etc. It will also encourage people to upgrade and add new components such as modems, cameras, etc. There are at least four reasons for purchasing a new model of an existing technology:
   • To replace an existing model that not longer works;
   • To obtain an additional unit of the technology;
   • To upgrade an existing model that works but does not have a desired feature or is lower quality than the upgraded model;
   • . As a byproduct of another purchase, for example, purchasing a modem with a new computer.
5. Technologies fail when they cannot be linked to a real consumer benefit. There are fads and cyclical patters of adoption. It will be important to provide a real service that consumers will keep using to avoid the initial period of success followed by a sharp decline in use of a service or technology. Some products are cyclical, popular for a time, then out-of-use for another period of time, then again popular by some new generation equipment or service. This was true of game consoles who experienced peaks and dips in popularity. These cyclical patterns of adoption are not failures but false starts.
6. New services require new equipment or service and will require a change in how people use media and alter their existing habits. New services are therefore more difficult to introduce and will take more time. Most communications technologies in this century were introduced in the context of uncertain demand (motion pictures, radio, phonographs, television). These are called technology push (versus pull), and will fail if they cannot create applications that people want. Entrepreneurs are more likely to bring creativity to the process of generating ideas for applications that people want. Other players such as municipalities and telecommunications companies, are there to ensure that the technology is implemented and to bring the resources to the project.
7. Most users are not interested in the black box. They want to know about the service. The marketing efforts must be geared to their needs and avoid techno-language. People will adopt technologies because they have:
   • A strong need, an unmet need in his/her life, a need that can be met at an acceptable price (could include support work at home and multimedia education services); b
   • An insatiable appetite for some content or service, includes gadget lovers who will pay just about any price for the latest technology or people who can’t get enough of movies, etc.
   • Pain avoidance, such as those who are experiencing pain in slow Internet access, stock of popular movies in video-rental shops, and poor customer service by existing broadband service providers. (28)

    

TECHNOLOGY

“In the short term, home users will need Mbit/s if digital video is not required and 4-6 Mbit/s including video. In the mid-term, more terminals are expected in the customer premises, as today several TV set can be easily found inside a single home. Tomorrow a number of digital appliances, connected to each other via advanced home networks, will be very common. The per-home total capacity is thus expected to increase to support the use of all these terminals, and bandwidth of 15 to 60 Mbit/s is suggested.” (29)

There are a number of possible solutions for building the community infrastructure:

1. Fibre-to-the-home (FTTH)
2. Hybrid fibre solutions (mixed with copper, coax)
3. Wireless technologies

There is no single, simple metric to compare these broadband technologies. Almost all of them are capable of operating over a range of speeds, depending on how they are actually implemented. The key to profitability for communities, may be in adopting hybrid mixes of wireless, copper, and fibre services that suit the geographical and economic constraints of the region. A conference on telecommunications convergence sponsored by the University of Denver found that many locations were using fibre loops, often without Sonet multiplexing, in conjunction with wireless local loop and local multipoint distribution services (LMDS) last mile access. (30)

There will also be some technologies required by the home, schools, hospital, municipality, and local businesses. The project may wish to buy some computers for homes or subsidize a portion of its cost for residents; it may purchase some equipment for schools and the hospital; it may subsidize a portion of the cost for businesses. These are decisions that can be taken at the business plan phase. For descriptions on technology, refer to Appendix A.

Fibre Optics

Fibre technology is the media that provides the highest bandwidth. It is resistant to electro-magnetic interference, it is corrosion free, and it provides transportation for data with minimal loss. Most of the network backbones are constructed with fibre optics but the last mile connection to the home has not always been feasible with fibre. The reason for the infeasibility is that the multimedia business is not mature enough to prove that there is a need for high bandwidth connections and fibre, however, this is changing very quickly. Fibre, when life-line voice is required, needs a battery backup system in case of power outage and it dramatically increases the cost. Life-line voice line is a requirement for emergency services such as 911 (services that people cannot do without in case of power failure). If fibre is not used as a life-line, or is being used as a second line option, then there are many technologies available. Traditionally, fibre to home has been delivered as a hybrid fibre-coax option (HFC) or passive optical network (PON) because thses architectures carried life-line voice. But for multimedia services, which are not considered life-line services, there are many other options available that are more cost effective. For example, direct Ethernet to the home is a possibility and such systems can carry both video, data, and second voice. (31)

The obvious benefit with optical fiber is its ability to transmit multiple channels of data simultaneously at signifigantly greater speeds over longer distances. It achieves this increase in performance with greater fidelity and without the degredation associated with copper and coaxial cable. Fiber does not increase infrastructure costs signifigantly. While laying any type of cable is expensive because of labor and infrastructure costs, the additional cost-per-foot of fiber over copper or coaxial becomes negligible to a project's total costs. Communities and municipalities are finding that, in anticipation of impending and future demands, and relative to the lifetime of the network, it is cost effective to lay dark fiber alongside copper lines while the trench is open. The physical properties of fiber also offer distinct advantages. Fiber does not conduct electricity and is completely impervious to all types of interference. In adddition, it will not corrode, is unaffected by atmospheric conditions and presents no danger of sparking. As far as security is concerned, fiber is nearly impossible to tap into, yet is easily monitored for intervention.

Fibre-to-the-home has been technically successful in more than three dozen field trials and installations worldwide. Now it is becoming commercially viable, thanks to recent advances in architecture and technologies. One of the new developments by delephone companies named PON or passive optical network, has made FTTH more commercially viable for telephone companies. This technology is very limiting in delivering competitive multimedia services. PON is lower bandwidth, distance limited, and ties the customer to the telephone company architecture. PON can be a single fibre extending from an optical transveiver at the service provider's location to an optical splitter near a small group of homes. The splitter divides the light signals equally among 16 or 32 output fibres (or homes), which then carry the signals to the customers’ homes. Other factors making fibre-to-the-home less costly include new lasers, optical components, fibre cables and digital integrated circuits designed specifically for the application. (33) The disadvantage with PON is that it can be expensive and it ties the customer to the telephone company.

Distance is not as important with fibre as it is with copper cables, because optical signals lose very little power as they move through fibre. PONs works as well in rural areas, where homes are widely separated, as they do in suburban or urban settings. The most advanced PONs will employ wavelength-division multiplexing, which assigns a unique wavelength, or colour of light for each customer’s signal. (34)

“The only technology that can rival the bandwidth cable and has the ability to provide the same combination of digital TV, telephony and data connectivity is fibre optic technology. It will boast data speeds of 100 times faster than any competing technology… The recent innovative developments that have made the deployment of fibre to the home within sight have been in passive optical networks (PON), an optical system with no active electronics (also known as dark fibre). In the past, connecting each home by running fibre was expensive, but technology today allows for three fibres to be run from the CO to an optical splitter that can then serve 32 homes. This makes the deployment of fibre more cost effective. If you are deploying into a new building or new area, laying fibre along side or in place of copper, the installation is not too costly. If you have to deploy fibre into an existing area already served by copper, or in rural area’s where subscribers are a long distance from the CO, then fibre can be expensive. The reason you should consider FTTH may lie in the explosive growth of new and improved telecommunications services that are consuming more and more bandwidth.” (35)

The second highly innovative development, dark fibre, is the recent front-runner in the implementation of fibre networks. "Selling dark fibre is like selling customers a fifty-story building for the price of the first floor…if you need more room, you add more lights and switches and move upstairs."(36) The economics of purchasing fibre once you have obtained the right-of-ways and paid for the construction costs is not very different whether you are buying two fibres or a dozen. Metromedia is installing large quantities of fibres and is finding that, surprisingly, their customers are coming back very quickly for more. The cost of lighting up the fibre is also decreasing very quickly. Fibre which would have been lit at a cost of a DS3, at about $3000 per month, can be lit by an OC-12 (14 times faster than a DS3), for $500 per month, and OC-12 is now old technology, surpassed by OC-48, OC-192, and OC-768, dropping the future price of a DS3 at a few bucks per month.

BellSouth is overlaying existing copper with fibre in an Atlanta residential neighbourhood. The trial utilizes asynchronous transfer mode passive optical networking (ATM PON), which is believed to be the first use of the technology in North America. In their configuration, there is a four-way splitter at the curb and an eight-way splitter further up the network, allowing each optical line terminal in the central office to be shared by up to 32 customers. Lucent’s optical network termination unit will be placed within a customer’s home to convert optical signals into high-speed Ethernet data for the PC. The Oki analog optical networking unit will provide video signals for a customer’s TV. BellSouth hopes to deliver 120 channels of digital video, 70 channels of analog video, 31 channels of CD-quality audio, and high-speed ADSL data service. Lucent is providing the optical access termination unit, which uses high-speed Ethernet and is placed inside the home, while Oki Electric is providing optical line terminals to convert video signals. The ATM PON has the potential to deliver data service at 100 Mbps. Adding electronics such as dense wavelength division multiplexing (DWDM) to the network can increase capacity without digging up streets and laying additional fibre. This becomes important in the future as demand increases. Despite occasional fibre cuts, fibre tends to be maintenance free, while copper can be subject to interference, noise, and other problems. Benefits: Fibre costs are similar to medium-speed services at much higher speeds. Fibre speeds are easily expandable by replacing inexpensive electronics. No need to upgrade to another infrastructure. (37)

One of the technologies that will certainly require more capacity than the current network structure can provide is digital video. Today, a digital video channel can be compressed to only require 1.5 to 6 Mbit/sec (depending on desired picture quality). Progress in the development of HDTV (high definition television) will require compressed bit rates for HDTV of 20 Mbit/s. A FTTH network could deliver 5 to 10 limited high-definition programs simultaneously with other services. This means that several members of the family could be viewing different programs/movies at the same time. As demand rises in the next 10-15 years, FTTH may be the best and only technology that can provide higher transfer rates and the only technology with low upgrading costs. (38)

In terms of customer needs or installations in the home, the customer installs an Ethernet card into their computer instead of a modem and simply plugs that computer into one of the Ethernet jacks that will be installed in their home. The customer will need to learn their IP address and some of their configurations to connect to the network. One of the problems with pure fibre installations is that it only accepts digital signal. Any equipment broadcasting in analog will not work. This is why some people feel that hybrid systems may allow customers to slowly switch their home equipment toward digital technology.

Hybrid Technologies, Fibre-Copper, Coax

Copper is the technology used by telephone companies. Coax is another copper technology used by cable companies. Telephone and cable companies are now using hybrid fibre-copper and fibre-coax solutions to bring higher speeds to their networks, decrease their operating costs, and allow for future growth in their industry.

Hybrid systems are economical because they share the cost of the fibre and electronics among all subscribers in the group, who can number in the hundreds. The transmission rates, however, are lower than those of fibre-to-the-home, because the final metallic connections act as bottlenecks. (39)

Copper wires, installed in more than 600 million phone lines worldwide, provide high-quality, dependable voice services and more technology is being invented and installed to use this valuable resource. The cost of changing all this technology is enormous, providing an incentive for companies to find ways to boost the capacity and copper wires. Telephone companies introduced ISDN (integrated services digital network), providing 64-128 kbps services, but it was marginally more useful than conventional modems. Later on, T-1 was introduced providing 1.5 Mbps but the price was more than people wanted to pay for data access. One new technology showing promise is DSL or digital subscriber line. DSL can bring a 50-fold increase in the speed to millions of modem users by introducing a new kind of switch at the central office of the telephone company. There are a number of variations on DSL technologies (ADSL, XDSL, HDSL, etc.) that hinges on the speed that can be offered, or whether the speed is offered two way or symmetric (same speeds for uploading and downloading), or offered asymmetric (higher speeds for downloading, lower speeds for uploading). Asymmetric digital subscriber line (ADSL), for example, would be capable of delivering 3-4 Mbps to the home and a fraction of this speed back from the home. ADSL is one answer for voice and data, but could not carry television.

One of the principle advantages of DSL technology is that the signal is not shared with other users such as cable television networks who share the signal (like a giant party line) among users. This makes it more difficult for people to listen in on your transmissions and makes the telephone wires more secure. Two of the problems with DSL technology is that a home must be located within a few kilometres of the central office to use the technology, and the technology is sometimes seen as limiting and slowing down the deployment of broadband.

The backbone networks for DSL carry composite signals for a few hundred consumers at 155 Mbps and up, a television channel has an effective throughput of about 24 Mbps, greatly limiting its effectiveness under heavy use by hundreds of cable modems.

The cable companies have used hybrid fibre-coax to improve their television signal while making it possible to offer two-way Internet and telephone traffic. To access the Internet, home-owners must obtain a cable modem, a device that attaches to the cable like a TV converter but decodes and manipulates data rather than television signal. The capacity of hybrid fibre-coax is up to10-30 Mbps to the home. The actual speed or data rate achieved in each home depends on how many users are sharing the channel at any given time. Cable modems have a roughly two-year head start on DSL technology.(40) Cable companies have been able to beat-out prices offered by telephone companies in the past, while offering larger bandwidth.

NTT in Japan is using fibre to the cub and conventional copper to the home in the ‘pi System’ hoping that this project will be a first step toward full fibre-to-the-home. NTT can save costs by installing optical fibre cables that have longer life and are less costly compared with copper wires, which might be replaced after 11 years. (41)

Wireless Technologies

There are a variety of technologies using different frequencies, among them are:

1. Satellite
2. LMDS, MCS, MDS, MMDS, ITFS
3. Microwave

The difference between various wireless alternatives is often the frequency on which it operates and the height and distance of the equipment. A fixed wireless carrier creates a data network that operates over MDS, MMDS, or ITFS frequencies. Some wireless carriers are operating in large, previously unallocated expanse of the electromagnetic spectrum and can therefore achieve much higher bandwidth.(42)

Satellite-based service is the most advanced and the most risky from a technical and investment perspective. A satellite system such as Iridium's orbiter would communicate directly with the subscriber and the user would access the data via a small dish antenna. Geosynchronous satellites are located at exactly the right height (36,000 km) above the earth to orbit at the same rate as the earth so that satellite dishes receiving TV signals don't have to move to track the satellite. The drawback is that there is about a quarter-second delay in sending a signal up and back which degrades many forms of data transmission. Low-earth-orbit (LEO) satellites are located below 2,000 km altitude from the earth and a remote unit at one residence can talk to another unit somewhere else by sending data up to whichever satellite happens to be overhead at the moment. It means lower radio transmission power so the home needs only a small, unobtrusive antenna and eliminates the delay in signals. The cost of putting a LEO satellite system is high because dozens of satellites have to be launched to cover the earth. The LEO voice system is up, as in Motorola's Iridium configuration, but it is too expensive for data systems. (43)

Satellite systems concentrate in video/TV and up/downstream Internet. You can put 1-2 Mbps using spoofing, caching, and pre-fetching on a satellite link. Satellite will never compete with fibre for long haul, it is a last mile technology and used as a fill-in until fibre is available.

Wireless systems for data tend to be earth-bound systems, such as cellular or LMDS. Cellular-based systems offer modest data rates of 10-50 kbps up to 1 Mbps. Other systems with much higher bandwidth have antennas that can be installed on telephone poles but they can be expensive with the need for several base stations. LMDS can offer high bandwidth rates, however, because radio waves travel only in straight lines, they can be blocked by buildings, obstacles, foliage, and even moisture.

Wireless local loop offers a cheap alternative to building a local telephone network. A small fixed radio antenna installed in a house or office receives and transmits calls through a transmitter. In the home environment, an antenna and transceiver at the home receives the incoming data signal and transmits it over in-home coaxial cable lines to a broadband modem. The modem connects to an Ethernet card in the PC or other appliance. In the office environment, an antenna and transceiver receives the incoming data signal and transmits it over coaxial cable lines to the broadband modem which interfaces with a local area network (LAN) through an Ethernet hub, switch, or router, providing access to multiple users.(44) This system is also useful for rural communities and can be merged with another cable or telephone system to offer an hybrid solution for remote areas. Many wireless systems utilize a technique called asynchronous transfer mode (ATM), used extensively in wide-area-networks and which allows a mixture of data to be sent at the same time, allowing a high quality voice service to run concurrently with Internet, other data and video applications.

Local Multipoint Distribution Services (LMDS), called LMCS in Canada, can deliver speeds of up to 155 Mbps and support voice connections, Internet, videoconferencing, interactive gaming, video streaming and other high speed data applications. It can be deployed quickly and relatively inexpensively as well as fill gaps in geographical coverage. LMDS cells cover geographic areas typically from 2-5 kilometers in radius. Wireless systems can create a host of problems depending on line of sight (need good roof tops), and sometimes weather. (45) Bandwidth limits and environmental issues such as weather have prevented wireless services from providing high quality Internet and video connections in the past, but the research and development of wireless product is proceeding at breakneck speed and many current problems will be resolved very quickly. Capital Telecom in Ghana is installing a wireless local-loop system for 50,000 subscribers and many similar projects are providing an excellent proving ground for the technology.

MMDS was historically used for entertainment purposes, 1 way communication downstream. MMDS is not affected by weather, and has a range of approximately 35 miles. They broadcast at 198 Mhz of spectrum and 2.5 Ghz band, and can be deployed anywhere. MMDS 2-way technology is being being deployed, mostly by Wordcom/Sprint. MMDS can achieve 10-30 Mbps. Trees are still a problem but new technology is expected to resolve this problem. MMDS is a good technology for rural areas, as it eliminates the need for 2nd line, and anyone within 35 miles that can see the tower can get service. It is not clear how many customers can be serviced with 1 cell. Companies are using a sector & cellular approach to design by placing a smaller cellular cell with lower towers within the 35 mile radius of the larger cell/tower to catch more customers in a larger geographical area. Premise equipment needed at the customer's residence are coax, Ethernet, modem, and transceiver at an approximate cost of US$700-$900 per home including installation fees, but the price is expected to go down to $300-$500 in the short term. Infrastructure costs includes towers and equipment at $500-$2000 per square mile radius depending on whether the community needs cellular service as part of the cell.

Cisco Systems has developed a fixed, non-mobile wireless communications system for high-speed transmission of data over MMDS frequency band and says consumers will be able to buy broadband wireless transceivers for $500. (46)

The Communications Research Council (CRC) and several private and public sector partners are testing a new wireless technology called BMW in Sudbury. The tests are expected to be completed in 2001 and would provide a wireless local loop system.

Several wireless providers have applied for an MCS license from the CRTC. Many companies are interested in the high-density areas of Canada (Toronto, Vancouver, Montreal). One of the contenders, Orbit, would be interested in providing services to smaller communities such as those in Northern Ontario. Their technology could offer 10 Mbit/s, 2-way, anywhere in North America. They would use AT&T backbone in Canada and MCI in the USA with a microwave or satellite transmission to a gateway. The price of wireless is low, at an estimated $35/month for residential services and $250/month for schools. There would be no long distance fees and up to 3 computers in each home could be connected to the wireless system.

PRICING

Pricing issues will be dependent on the financing of the project, the payback period, government involvement, and the cost of the technology (installation and operational costs). In the meantime, the project can take examples of pricing from other projects:

Palo Alto: Residents were originally going to pay a fibre installation cost of US$1200, plus a monthly usage fee of US$45 per month for 10 Mbps access and US$100 per month for 100 Mbps access.(47) Later in the project, the fibre installation fee was waved. Residents will only pay the monthly cost.

Sierra Pacific: Along with Hewlett Packard and Oracle, will offer in Nevada, 10 Mbps access for US$13.95/month.

Cost of Technology

               Component             Cost per Connection
            Copper                  $200-$2000
            Fixed Wireless          $500
            Coaxial cable           $500
            Fibre to curb           $1050 upward
            Fibre to heom           $2000 upward    

(48)

According to a study performed by Bellcore in early 1996, the gap of per subscriber-installed cost (for FTTH) had shrunk to $230 in narrowband access and to $480 in broadband access. The two largest cost components now are electronics (nearly 40%) and labour (about 30%). According to a number of studies, the first cost of a two-way HFC broadband access network is $1125 per subscriber. The installed cost of a FTTC broadband network is estimated around $1000 to $1500 per subscriber for a telephone company, and the installed first cost of FTTH per subscriber ranges from $1500 to $3000. In the case of FTTH, the final cost of the per-subscriber access depend much on system architecture, functionality, and demand assumptions. Operational costs include electrical powering of the network, maintenance expenses and expenses of connecting and disconnecting services. Optical networks power consumption is considerably less than that of conventional coaxial or twisted pairs due to the nature of an all-dielectric network. The maintenance costs are very low since an all-plastic network is corrosion free whereas metallic cables suffer from this issue. (49)

Operational cost savings of FTTH per subscriber when compared to FTTC or HTC over 20 years : (50)

    Electrical Powering             $200
    Metallic Drop Maintenance       $200
    Other Maintenance               $100
    Service Provisioning            $ 50

If we relax the constraint on the payback, shifting the target to 8 years, a good combination of environmental conditions and effective installation techniques enables a $700 (CAN equivalent) installation cost per user (according to a European project estimate), a yearly revenue lower than $270 (CAN equivalent) per user is sufficient to justify the investment. If we look at the residential market, the FTTH architecture can be chosen taking into account its evolutionary potential for new services. A telephony centered service offering would favour other more conventional, and cheaper, solutions. In conclusion, today FTTH architectures can be economically deployed in selected areas, where users’ willingness to pay is matched with limited deployment cost, thanks to specific environment or exploitation of new installation techniques. A targeted deployment, a phased installation and longer than average local loops can further improve the economic viability of the all-optical access network. (51)

Again, there are no clear metrics to compare technologies. Factors such as life cycle, flexibility, expandability, and maintenance costs need to taken into consideration.

REGULATIONS

In Canada and the USA, there are various regulations that encourage or discourage competition and regulate what a community can do. Prior to starting a project, a community should communicate with the CRTC in Canada or the FCC in the USA to identify the possible constraints. In Canada, “any Canadian public institution - schools, hospitals, cities, universities, churches, etc. - can hand their own cables on telephone poles. Lots of them are doing it. As a result, there is already much fibre in Canada’s neighbourhoods, close enough to where people live that fibre to the home will soon be common.” (52)

FINANCING

The project financing has two stages:

1. Financing a business Plan
2. Financing the implementation

Financing a business plan:

The business plan will include:

• The architectural/engineering report
• The applications report including the details of the activities that will be undertaken on the network including the partnerships for e-learning, tele-health, e-commerce and more
• The governance, ownership, human resource, marketing plan, financial plan, and action plan report

The options for financing the business plan are:

• Project partners: telephone companies, cable companies, IT sector, Colleges and Universities, hospitals, municipalities, have a stake in this project and may be willing to make a contribution to the business plan.
• Government sources: several branches of government have been supporting this type of initiative especially when it can demonstrate an economic benefit to communities.

Financing the implementation:

The implementation will take three phases:

1. Educating the community: pre-operational phase
2. Installing the network: operational phase
3. Implementing the programs: post-operational phase

Pre-operational phase:

Some form of ‘educator’ participation is required to set-up a network centre equipped with computers linked to a high speed network to begin educating the community. In addition, the community should develop a partnership with the media and begin a campaign to explain the project through its various phases. Other partners and agencies that stand to benefit from the project should be approached to help finance this phase.

Operational phase:

The ownership issues must be resolved. If the private sector will have ownership (in part or in full), it will need to contribute more heavily to the cost of the network. The municipality may utilize government funding to attract private sector investors and ensure that the highest quality for maximum efficiency is provided. Other private sector providers, such as those selling switches, routers, and other forms of equipment, usually provide large discounts of projects such as these, and can sometimes be convinced to make investments (capital or operational) in a project. Government funding may also be required for the customer-premise equipment (CPE), or the incentive funding which may or may not be made available to each home. An example of public/private partnership is the Algoma District Network (ADNet) in Sault Ste. Marie, Ontario, Canada.

Post-operational phase:

Once the network is in place, there will be a need to fund a training centre to continue educating the community, and staffing to continue finding investors and projects to demonstrate on the network and managing the utilization of the network.

APPENDIX ‘A’: Definitions and Descriptions

High Speed DSL or HDSL: offers a symmetric speed of 1,544 Kbps in both directions just like a T1 line but less expensive than T1 lines. Beyond 3 miles of central office (or 5 km), this technology is technically challenging. Cost to the consumer is usually between US$50 to $70 per month.

The final step in the evolution of the public telephone network will be the integration of voice, high-speed data transmission, and video into a single network. This is referred to as a ‘broadband network’ because of its ability to deliver services that require a broad range of communication frequencies or bands. Broadband applications include television programming, picture phones, high-quality colour graphics, and high-resolution medical images. (1)

Symmetric DSL or SDSL: offers a symmetric speed of 768 Kbps in both directions.

ISDN DSL or IDSL: offers a symmetric speed of 128 Kbps in both direction just like an ISDN line but cheaper than ISDN.

Asymmetric DSL or ADSL: offer an asymmetric speed of 192 to 8,192 Kbps (8.2 Mbps) in the downstream direction and 64 to 1,088 Kbps (1.1 Mbps) in the upstream direction. This has been popular with the Internet since download speeds are more important than upload speeds. PTCI/EagleNet in the US offered this technology called JETNET ADSL for US$40.95 per month for residential service and US$99.95 per month for business rates. As part of the introductory offer, they included the necessary hardware and installation free of charge (value of $500). Because of distance limitation of the ADSL technology, they were unable to provide the service to customers more than 18,000 feet (3.4 miles) from the central office.

G.lite DSL or Splitterless DSL: offers an asymmetric speed of 192 to 1,544 Kbps in the downstream direction and 64 to 512 Kpbs in the upstream direction.

Very high speed DSL or VDSL: offer asymmetric or symmetric speed of up to 52,000 Kbps. This is sometimes used to replace fibre line to the service provider’s fibre hub.

Cable modems: technology requires significant upgrades to become bi-directional and can provide speeds of 10,000 Kbps for multiple users in a neighbourhood to 36 megabits per second. Cable users are also ‘always on’ like xDSL connection. Although you get lightning-fast connections at the beginning, the speed slows down as more neighbours sign on. If cable companies have not invested in technology to provide bi-directional service, their downstream direction speed is 10,000 Kbps, but upward speed is 64 to 128 Kbps. The main problem is to ensure security of users and to curb abuse by neighbours who use large amount of bandwidth by transferring large files or by running web servers from their home.

Digital Broadcast Satellite: technology is resold by phone companies and offers two downstream speeds of 200 Kbps or 400 Kbps and upstream speeds of 64 Kbps or 128 Kbps. The downstream bandwidth is shared between multiple users. This technology is popular among remote users who do not have access to wireline broadband technologies such as DSL or cable modems.

Local Multipoint Distribution Service or LMDS: wireless technology with varying speeds depending on the number of cell sites and the capacity of each cell site. The bandwidth is shared in both directions. Biggest challenge is roof rights for installing microware receivers.

Fiber: relies on light energy rather than electricity to communicate information. They can carry the same kinds of signals as satellites with greater speed and less distortion at less expense. Since the data is transmitted as light waves instead of electrical pulses, they are immune to the electrical interference that causes static and distortion in electronic systems. Two types of fibre: single-mode and multi-mode. Single has a smaller core and is less susceptible to dispersion of its light signal requiring fewer amplifiers along a path but it is more difficult to terminate and therefore not the best answer for local networks. Fibre uses optical amplifiers, transmitters, and receivers. Dark fibre is fibre without the transmitters, receivers, or associated electronics attached to them by CPAU, making the fibre less expensive. The service provider is then free to attach the voice, data, or video equipment of their choice to light the fibre and transmit information between locations.

The following applications need the following bandwidth:

• Analogue phone: around 10 kilobits/second (kb/s)
• Digital videophones: up to 100 kb/s
• Integrated video-conferencing, full motion video: up to 1 megabit/second (Mb/s)
• Desktop video-conferencing: up to 10 Mb/s
• Visualization: up to 100 Mb/s

ENDNOTES