ISPCON Keynote: Donny Smith

At ISPCON, the guy who's been the talk of the hallways and the ISP CEO session finally presented his plan to bring fiber to rural Minnesota in a keynote.

by Alex Goldman ISP-Planet Managing Editor [November 21, 2008]

I first described the network of Owatonna, Minn.-based Jaguar Communications about a year ago (see Jaguar Communications' Rural Fiber Network). When it came time to look for keynotes for ISPCON, Jon Price and I agreed that Donny Smith was the obvious choice.

As I described in my article, his offering is very impressive, but the paperwork he had to wade through explains why nobody else I know of has done what he has done. Besides the USDA, I wrote:

"Smith says he also needed approval from the following entities (listed in no particular order): Minnesota State Historical Preservation Office, US Army Corps of Engineers, Minnesota Pollution Control Agency, USDA Natural Resources Conservation Service, the U.S. Fish and Wildlife Service, Minnesota Department of Natural Resources (DNR) Trails and Waterways Division, Minnesota Department of Natural Resources (DNR) Division of Lands and Minerals, each county's soil and water conservation district, and, last and perhaps most enormous, every township and city in the coverage area (Smith says there were 103)."

In addition, Jaguar Communications is more than an ISP. The company is a CLEC, ISP, MSO, and home communications provider, Smith said.

Smith described his coverage area as being about 100 miles by about 80 to 90 miles, bounded to the East by the Mississippi River, to the South by the Iowa border (however, he now offers some service there too), and to the North by Minneapolis. To the West, the border is less clearly defined. Jaguar Communications serves, roughly, the Southeast quadrant of the state of Minnesota.

In the speech, he provided numbers and details, and the speech, for many, was alone worth the price of admission to the show. This article is a summary of the speech and does not contain the details.

The network
The network uses GPON primarily, which, Smith says, maps nicely to the telco T-1. But you want to match the technology to the application, he said, so you should consider DWDM in some cases.

The current generation of GPON has a range of 12 km. Jaguar uses Calix, and the company recently announced that its newest equipment reaches 20 km.

Jaguar builds a central node and extends the network out 9 km in every direction. At the end of the 9 km, it meets a strand from another node 18 km away. He opens the fiber relatively frequently, and extends strands laterally. This creates a "fishbone" or "Christmas tree" shape to the network.

He uses fixed wireless both to extend the network and, in some cases, to deploy immediately in a town when he has a node but has not yet built the fiber, early in the deployment. Overlapping fiber coverage areas, however, are designed to connect to 100 percent of all areas (Minnesota does not have mountains, but it does have lakes, and the lakes break the symmetry of this network, so this is a quick and dirty description of a network that is in practice more complex).

He says that being the first to lay fiber is cheaper—it's more expensive if you have to ensure that your fiber route does not cut anyone else's fiber.

Conclusions
Because he is selling several different services—voice, video, and data—Smith says that it makes more sense to him to keep track of Revenue Generating Units (RGUs) than subscribers. This is the tack that other competitors, such as RCN, have taken.

Smith claims that if you dig your own trenches, you can save significantly on costs, and that opening up the fiber regularly makes the initial deployment more expensive, but lowers the costs of acquiring customers later.

He says he's had twelve service calls related to fiber in his first two years: ten about how to use the remote control, one about a lightning strike, and one about a rabbit that chewed the cable. Since fiber (unlike copper) does not conduct electricity, the lightning was a direct hit on the house and did not affect the rest of his network.

Finally, two old truisms are worth brining up. One is the joke that goes, "How do you eat an elephant? One bite at a time!" It's a big project, and you'll be learning every step of the way. Smith's first application for funds was rejected, and that was part of the expenses and part of the learning curve.

The other is that you should be "frugal, but not cheap." A lot of the equipment in the network is expensive, but none is needlessly so.

Smith believes that fiber is the future because of the money: it is the highest capacity network and it costs the least to run. That's a winning combination, and if the government would not work so hard to prevent people from taking its Rural Universal Service (RUS) loans, we'd see more networks like that of Jaguar Communications.

— End