Fwd: Cost figures from Canada for dark fiber for schools

[Gene Hastings <hastings@info-ren.org>]

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Date: Tue, 13 Jul 1999 17:33:47 -0400 (EDT)
Message-Id: <199907132133.RAA01847@tweetie.canarie.ca>
From: CAnet-3-NEWS@canarie.ca
Subject: More Details on the Cost of Dark Fiber for Schools

For more information on this item please visit the CANARIE CA*net 3 Optical
Internet program web site at http://www.canet3.net
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Once again I am extremely impressed at the leadership that some Quebec
school boards and regional networks are showing in terms of deploying dark
fiber to every school.  Through their efforts Quebec and Canada are clearly
being seen as world leaders in next generation optical networking. Through
their pioneering work they are clearly demonstrating that Gigabit Internet
to the School is a reality today and that Gigabit Internet to the Home is a
lot closer than most people think.

Over the past few days I have had several meetings with representatives from
some school boards, RISQ and IMS in Quebec. These organizations have been
very helpful in explaining the fine details on how school boards and
regional networks can build their own dark fiber networks and substantially
reduce their telecommunication costs.

By building their own fiber networks these school boards claim they can
connect up schools with dark fiber for an average of $80 per month per
school based on a 20 year amortization of the fiber!!  Internet access and
LAN equipment costs extra.

They also estimate the payback for dark fiber is anywhere from 6 months to 2
years.  Not only do the school boards save money  by eliminating the monthly
charge for managed bandwidth, they also achieve substantial savings by
eliminating the network servers at each individual school.  With dark fiber
and essentially unlimited bandwidth (currently 100 Mbps) each individual
school's LAN can be extended back to the central administrative site.
Maintenance, backups and software updates can all be done much more cost
effectively from the central administrative building.  And now with the
possibility of unlimited bandwidth the schools are free to explore new high
end applications such as video conferencing, Voice over IP, etc etc

Previously these school boards were paying up to $400 a month for DSL or T1
service.  For a typical 100 schools in a moderate size school board they
would be paying $1.4m over 3 years for such a managed bandwidth service.  A
dark fiber optic network for the same number of schools costs about $1.5m.
These prices are typical for a school board in a suburban/rural area like
those north of Montreal.  Urban schools should expect slightly higher costs.

In many ways dark fiber is the great social leveller.  It is much more
expensive to install fiber in rich, upper class neighbourhoods where all the
services are buried.  Rural neighbourhoods generally still have their
telecommunications services delivered on poles.  Fiber can be installed for
as little as $6 per meter on poles. Buried fiber in urban areas typically
costs between $15 to $25 per meter and sometimes can be substantially
higher.

Should school boards build their own dark fiber network??  They is a
decision that is based on a number of factors.  But every school board,
regional network and/or municipal network should at least go through the
initial steps of finding out the real costs of building their own fiber
network.  They will then have a benchmark price for negotiating dark fiber
or a managed service from their local carrier or utility.

The first step is to retain the services of a reputable Optical Fiber
consultant.  IMS in Montreal has been providing this service for the school
boards in Quebec.  IMS - Robert Proulx - 819-694-1874  -
r.proulx@muni-ims.qc.ca  IMS has been providing optical fiber consulting
services throughout Canada and the US.

A Dark Fiber consultant will do a preliminary engineering survey to arrive
at an estimate of the project cost.  A preliminary engineering study will
cost about $10k and involves physically walking the possible route where the
fiber will be deployed.  Every utility pole, conduit, road, river and rail
crossing must be identified.  The consultant will then prepare a detailed
engineering map showing the fiber costs, section by section.  Some sections
may be very expensive and as such alternate routes may need to be
identified.  The shortest route is not necessarily the cheapest route.

Upon completion of the preliminary engineering survey the optical fiber
consultant will work with the client to help develop a RFP and identify a
potential carrier partner.  Only licensed carriers, CLECs and cable
companies are allowed to deploy fiber on public infrastructure such as
utility poles.  The licensed carrier must also own the fiber facility and be
liable for maintenance and installation.  The licensed carrier then grants
an "irrevocable right of use" (IRU) for the fiber to the school board,
typically for 20 years.

There are different arrangements that can be made with a licensed carrier,
cable company or CLEC for building the fiber network.  Some charge a
percentage of the capital costs, while others will insist on retaining a
number of  strands for their own future use (typically 6).  A typical
arrangement is for the school board to pay for all the capital costs and the
small annual recurring maintenance charges.  When the licensed carrier puts
commercial traffic on its reserved strands then all recurring maintenance
charges incurred by the school board are waived.

The optical fiber consultant will also work with the school board to
identify other potential organizations who may want their own dark fiber and
would be willing to contribute to the cost of the fiber build.  Hospitals,
municipal governments, libraries, community colleges, etc are all potential
partners.  Since a substantial portion of the costs are in the actual
installation the more parties who can be brought into the project before
construction starts the better.  Once the fiber is installed it is very
difficult to add additional partners, except by undertaking a new fiber
build.

The next step is for the school board to issue an RFP for the construction
of the fiber network.  School boards are quite familiar with the process of
soliciting bids for large capital construction projects.  The consultant can
help identify reputable contractors who will meet the requirements of the
licensed carrier.  Of course one of the key requirements for the RFP is that
the contractor has arranged to build the fiber under the license of a
registered carrier.

The fiber consultant will assist the school board in analyzing the responses
to the RFP and provide project management and construction supervision. The
fiber consultant will also prepare the detailed engineering documents
required by the utilities  for installing the fiber on poles or in conduits.
Typically these engineering services amount to 20% of the overall contract
price for the project.

The Costs:
   Fixed one time costs: $7 to $15 per meter for all engineering, installation
and construction services
   Recurring costs such as right of ways, maintenance, pole and conduit
rental, etc:
     on poles: $.52 per meter per year
     underground: $1.05 per meter per year

As mentioned before recurring costs are usually waived once the carrier
places commercial traffic on their strands.

Maintenance contracts typically specify an average 4 hours to get to the
site and 2 hours to repair.  Times may be longer in winter, or in remote
rural areas.

With the new Gigabit Ethernet switches and long range lasers up to 100km of
fiber can be light with no repeaters.  These distances are usually well
within the territory limits of most school boards.  The new 10Gigabit
Ethernet and CWDM technologies promise to significantly increase bandwidth
to in excess of 40 Gbps. So for less than the cost of a DSL circuit a school
board will soon be able to build its own terabit network.  This gives new
meaning to the phrase of Optical networks for the rest of us.

For more information:

IMS Consultants - Robert Proulx- VP Engineering - 819 694-1874
r.proulx@muni-ims.qc.ca

L'affluent school board - one of the first to build dark fiber to its school
Bernard Lemonner - 450 581-6411 ext 440
bernard.lemonnier@ti.csaffluents.qc.ca

Richard Lacroix - Vice President - GRICS
514 251-3700   lacroixr@grics.qc.ca

RISQ
Yves LeBorgne  leborgne@risq.qc.ca
Luc Desrossiers desrosiers@risq.qc.ca
514 845-7181

La Vitre c'est La Liberte

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Bill St. Arnaud
Senior Director Network Projects
CANARIE
bill.st.arnaud@canarie.ca
+1 613 785-0426

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