Community Community NetworksNetworks

Evolution of the Evolution of the RevolutionRevolutionFrançois D. MFrançois D. Ménardénard

Project ManagerProject Manager

IMS Experts-ConseilsIMS Experts-Conseils

f.menard@ims-experts.comf.menard@ims-experts.com© 2001-2002 – © 2001-2002 – No reproduction permitted No reproduction permitted

without consentwithout consent

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About IMS ExpertsAbout IMS Experts

ISO 9001 Consulting Engineering ISO 9001 Consulting Engineering OrganizationOrganization

130 people – 4 offices in Quebec130 people – 4 offices in QuebecLight Metals, Civil Engineering & Light Metals, Civil Engineering & TelecommunicationsTelecommunications

35 people in telecommunications35 people in telecommunications> 5 years of experience in building > 5 years of experience in building private fiber optic networksprivate fiber optic networks

Non-dominant carrier subsidiaryNon-dominant carrier subsidiary

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Answering Market NeedsAnswering Market Needs

Solving needs in bandwidth of higher-learning institutions and Solving needs in bandwidth of higher-learning institutions and schools using the most cost effective, future-proof approachschools using the most cost effective, future-proof approach

Saving money in comparison to existing high speed Saving money in comparison to existing high speed alternativesalternatives

Facilitating the business case for owning telecommunications Facilitating the business case for owning telecommunications infrastructure rather than renting telecommunications infrastructure rather than renting telecommunications servicesservices

Taking full advantage of the regulatory environment favorable Taking full advantage of the regulatory environment favorable to increased competition in telecommunicationsto increased competition in telecommunications

Participating in consortiums with a view of reducing the Participating in consortiums with a view of reducing the investments (the network capacity can doubled for an investments (the network capacity can doubled for an additional 10% in costs)additional 10% in costs)

Reducing the time to deployment of broadband applicationsReducing the time to deployment of broadband applications Needs for a carrier in the business of commercializing Needs for a carrier in the business of commercializing

infrastructure rather than servicesinfrastructure rather than services

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IMS Key RealizationsIMS Key Realizations 5,000 km of network for the Reseau d’Informations 5,000 km of network for the Reseau d’Informations

Scientifiques du Quebec (RISQ), linking all Scientifiques du Quebec (RISQ), linking all universities in Quebec.universities in Quebec.

25% needed to undergo construction, the rest was 25% needed to undergo construction, the rest was swapped.swapped.

Detailed engineering for 13 school boards (over Detailed engineering for 13 school boards (over 1,000 km) and preliminary engineering for more 1,000 km) and preliminary engineering for more than 30 school boards (over 3,000 km)than 30 school boards (over 3,000 km)

Municipal networks in over 15 citiesMunicipal networks in over 15 cities Community networks in Kamloops, B.C. & Community networks in Kamloops, B.C. &

Fredericton, N.B.Fredericton, N.B. Optical Research Area Networks in Alberta, Ontario, Optical Research Area Networks in Alberta, Ontario,

Quebec, New Brunswick, Prince Edward Island and Quebec, New Brunswick, Prince Edward Island and Nova ScotiaNova Scotia

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Overview of Dark Fiber in Overview of Dark Fiber in QuebecQuebec

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RISQRISQ

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School boards in QuebecSchool boards in QuebecSCHOOL BOARD

Stud

y

Eng

inee

ring

Con

stru

ctio

n PROJECT

Capitale x Bell 140 km of fibre optics 80 schools Région-de-Sherbrooke x Bell 180 km of fibre optics 66 schools Rivière-du-Nord x 175 km of fibre optics 52 schools Seigneurie-des-Mille-Iles x x x 200 km of fibre optics 80 schools 4 partners Amiante x x x 12 km of fibre optics 9 schools Laval x x x 170 km of fibre optics 111 schools 3 partners Saint-Hyacinthe x 250 km of fibre optics 51 schools Affluents x x x 170 km of fibre optics 70 schools 4 partners Bois-Francs x x x 60 km of fibre optics 12 schools 4 partners Draveurs x Vid. 90 km of fibre optics 40 schools Grandes-Seigneuries x x x 210 km of fibre optics 58 schools Vallée des Tisserands x x x 30 km of fibre optics 56 schools Hautes-Rivières x 250 km of fibre optics 54 schools Laurentides x 200 km of fibre optics 35 schools Patriotes x 2 km of fibre optics 3 schools Première-Seigneurie x Bell 190 km of fibre optics 73 schools Samares x x x 460 km of fibre optics 72 schools Trois-Lacs x x 45 km of fibre optics 15 schools Chemin-du-Roy x 29 km of fibre optics 11 sites Cœur des Vallées x 53 km 19 sites Marie-Victorin x 6 km of fibre optics 5 schools Sir-Wilfrid-Laurier x x x 92 km of fibre optics 20 schools

TOTAL 3014 km of fibre

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Municipal networksMunicipal networks• Municipality • Scope

• City of Brossard • Pilot project: Fiber to the home

• City of Lachenaie • 14 km of fibre optics 3 buildings

• City of Laval • 90 km of fibre optics 45 buildings

• City of Mirabel • 60 km of fibre optics 10 buildings

• City of Québec • 100 km of fibre optics 60 buildings

• City of Repentigny • 10 km of fibre optics 4 buildings

• City of St-Eustache • 6 km of fibre optics 8 buildings

• City of Terrebone • 10 km of fibre optics 5 buildings

• City of St-Laurent • 12 km of fibre optics 9 buildings

• City of Sherbrooke • 30 km of fibre otpics, 6 buildings +• Study for the implementation of Internet

Protocol telephony

• City of Longueuil • 180 km of fibre optic, 60 buildings

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Fredericton Community Fredericton Community NetworkNetwork

15 km backbone

13 buildings

600 FTTB

12,000 FTTH

Construction starting fall 2002

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Kamloops Community Kamloops Community NetworkNetwork

46 km backbone

43 buildings

4,000 FTTB

20,000 FTTH

Construction in 2002

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Optical Research Area Optical Research Area NetworksNetworks

Nova Scotia: > 1,000 kmNova Scotia: > 1,000 km

New Brunswick: > 2,000 kmNew Brunswick: > 2,000 km Quebec: > 5,000 kmQuebec: > 5,000 km Alberta: > 1,000 kmAlberta: > 1,000 km Ontario: > 2,500 kmOntario: > 2,500 km

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CANARIE 2001 IWAY CANARIE 2001 IWAY AWARDAWARD

Thanks to Robert Proulx and the team at IMS Experts-Conseils, schools, governments and communities in six provinces are now taking charge of their broadband network infrastructure to receive their data transmissions and are getting more connected than ever before. IMS Experts-Conseils has developed a unique model that enables users to become owners of their fibre optic network -- a concept that, less than five years ago, would have been next to impossible.

2001 Application of Technology Award

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IMS Key activitiesIMS Key activities

Preliminary engineering studiesPreliminary engineering studiesDetailed engineering studiesDetailed engineering studiesFormation of consortiumFormation of consortiumManagement of the tender processManagement of the tender processSurveillance of constructionSurveillance of constructionCommercialization of excess capacityCommercialization of excess capacityNon-dominant carrierNon-dominant carrier

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IMS Key activities 1/7IMS Key activities 1/7

Preliminary engineering studiesPreliminary engineering studiesSurvey of existing infrastructureSurvey of existing infrastructureSurvey of rights of waySurvey of rights of wayDetermination of the route of the networkDetermination of the route of the networkProduction of plans and of a cost estimateProduction of plans and of a cost estimateBusiness case analysisBusiness case analysisReport with a view of pursuing with Report with a view of pursuing with detailed engineering.detailed engineering.

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IMS Key activities 2/7IMS Key activities 2/7

Detailed engineering studiesDetailed engineering studiesBuilding on a preliminary engineering Building on a preliminary engineering study, if availablestudy, if available

Producing of plans with a view of Producing of plans with a view of seeking attachment permitsseeking attachment permits

Negotiations with other carriers to pilot Negotiations with other carriers to pilot the formation of consortiumsthe formation of consortiums

Producing of tender support documentsProducing of tender support documents

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IMS Key activities 3/7IMS Key activities 3/7 Formation of consortiumFormation of consortium

Meet and negotiate with several Meet and negotiate with several playersplayers

Build market power by proving Build market power by proving knowledge of true costs associated knowledge of true costs associated with acquiring a fiber optic networkwith acquiring a fiber optic network

Make a compelling argument with Make a compelling argument with other carriers to join the consortium other carriers to join the consortium and swap new routes against spare and swap new routes against spare capacitycapacity

Determine costs of each participants Determine costs of each participants in the consortium proportionality to in the consortium proportionality to the number of fiber strands the number of fiber strands commissioned in the consortium and commissioned in the consortium and to the establishments servicedto the establishments serviced

Administrative and brokering roleAdministrative and brokering role

Preliminary study

Feasability study

Establishment ofConsortium

DetailedEngineering

Specif ication ofequipments

Tender Surveilliance ofconstruction

Interconnectionpoints w ith ISPs

and ASPs

Delivery of thenetw ork

Management ofthe netw ork

Study oftelephone system

in place

Evaluation ofoffers fromcontractors

OKNo

OK

Requests to usesupport structures

No

Implementation ofInternet Protocol

telephony

Study ofinformation

systems in place

Implementation ofnetw orking and

new applications

Are f ibers alreadyavailable ?

No

Yes

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IMS Key activities 4/7IMS Key activities 4/7

Management of the tender processManagement of the tender processPrepare technical specifications of the Prepare technical specifications of the network in compliance with the needs of network in compliance with the needs of each participants in the consortiumeach participants in the consortium

Prepare tender documentsPrepare tender documentsEvaluate responses to the tenderEvaluate responses to the tenderMethodology for selecting the Methodology for selecting the contractorscontractors

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IMS Key activities 5/7IMS Key activities 5/7

Surveillance of constructionSurveillance of constructionHandling changes in the networkHandling changes in the networkHandling refusals on permits to attach Handling refusals on permits to attach and selection of alternative routesand selection of alternative routes

Validating that network performance Validating that network performance tests (OTDR) meet the specificationstests (OTDR) meet the specifications

Interface between contractors and Interface between contractors and participants in the consortiumparticipants in the consortium

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IMS Key activities 6/7IMS Key activities 6/7

Commercialization of excess capacityCommercialization of excess capacityDefining proper market pricesDefining proper market pricesImpartial arbiter to quantify the fair Impartial arbiter to quantify the fair value for excess capacityvalue for excess capacity

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IMS Key activities 7/7IMS Key activities 7/7

Non-dominant carrier*Non-dominant carrier*A valid telecommunications carrier license is A valid telecommunications carrier license is necessary to use public support structuresnecessary to use public support structures

Administration of recurrent fees associated Administration of recurrent fees associated sale of fiber optic strands through irrevocable sale of fiber optic strands through irrevocable right of use (IRU)**.right of use (IRU)**.

Impartial arbiter to quantify the fair value for Impartial arbiter to quantify the fair value for excess capacityexcess capacity

• * Terminology defined in CRTC Decision 95-19* Terminology defined in CRTC Decision 95-19• ** in US, Indefeasible Right of Use** in US, Indefeasible Right of Use

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IMS SkillsIMS Skills

Project and costs managementProject and costs managementEvaluation of the cost of realizing fiber Evaluation of the cost of realizing fiber optic networksoptic networks

Direct relationships with top Direct relationships with top executives within ILECS, CLECs, executives within ILECS, CLECs, CAPs, Cable Carriers, Municipal CAPs, Cable Carriers, Municipal administrations & Governments.administrations & Governments.

Extensive experience in engineering Extensive experience in engineering private fiber optic networks with private fiber optic networks with paybacks of <2 years.paybacks of <2 years.

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What is involved in What is involved in costing costing

fibre optic networks?fibre optic networks? Surveying the route and finding a pathSurveying the route and finding a path Estimating labour costsEstimating labour costs Requesting and paying for access to support Requesting and paying for access to support

structuresstructures Forming a consortium to spread the risks and Forming a consortium to spread the risks and

costs of building the networkcosts of building the network Ensuring that someone owns and maintain the Ensuring that someone owns and maintain the

cablescables Recommending equipment strategiesRecommending equipment strategies Developing business cases and revenue modelsDeveloping business cases and revenue models Maintaining a database of dark fibre routesMaintaining a database of dark fibre routes

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What is the What is the Condominium Condominium

deployment model?deployment model? A deployment model which focuses on selling rights to A deployment model which focuses on selling rights to

use fiber optic strands as infrastructure proportionally to use fiber optic strands as infrastructure proportionally to its costs, rather than as services.its costs, rather than as services.

A deployment model where multiple participants share A deployment model where multiple participants share the costs of deploying the network proportionately to the the costs of deploying the network proportionately to the number of fiber optic strands commissioned by each number of fiber optic strands commissioned by each participant on any given segment.participant on any given segment.

A way for incumbent carriers to experiment with the A way for incumbent carriers to experiment with the dark fiber business model without explicitly filing a tariff dark fiber business model without explicitly filing a tariff for such a service.for such a service.

The emergence of CLECs has been a key ingredient as The emergence of CLECs has been a key ingredient as they do not view Condominium fibre community they do not view Condominium fibre community networks as a threat since they do not compete to networks as a threat since they do not compete to provide an alternative on-ramp to the PSTN.provide an alternative on-ramp to the PSTN.

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Existing business case Existing business case for FTTBfor FTTB

and its evolution to and its evolution to FTTHFTTH

Saving costs and increasing speeds of data Saving costs and increasing speeds of data connectivityconnectivity

Works best for organizations with several sites within a Works best for organizations with several sites within a geographically constrained area and where there is high geographically constrained area and where there is high demanddemand

Will it be content or connectivity that will drive FTTH?Will it be content or connectivity that will drive FTTH?In light of captive portals and sticky connectivity models, In light of captive portals and sticky connectivity models, will peer to peer with QoS ever become available across the will peer to peer with QoS ever become available across the Internet?Internet?

Potential revenue models for FTTHPotential revenue models for FTTHAre municipalities to become telecommunications carriers? Are municipalities to become telecommunications carriers? Is the pie large enough for all competitors?Is the pie large enough for all competitors?

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ConclusionConclusion

Advances in deregulation and Advances in deregulation and technology are making it possible for technology are making it possible for customers to own their networkscustomers to own their networks

Thereby increasing speeds, reducing Thereby increasing speeds, reducing costs, and making it possible to costs, and making it possible to deploy new applicationsdeploy new applications

FTTH Community Networks is a FTTH Community Networks is a compelling model which builds on compelling model which builds on the success of FTTB Community the success of FTTB Community NetworksNetworks

Achieving Achieving competition and competition and

innovation through innovation through structural structural separationseparation

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Telephone Systems work Telephone Systems work like Railwayslike Railways

The phone system must maintain central control of the call from end to end to maintain its integrity;

The phone system completely specifies the outcome, timing, and routing of the message.

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From railways to From railways to highways…highways…

The owner of the The owner of the roadbed does not roadbed does not determine the determine the nature of the traffic, nature of the traffic, beyond general beyond general rules.rules.

The owner of the The owner of the vehicle determines vehicle determines what he will what he will drive,and where he drive,and where he will go.will go.

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Proposed ArchitectureProposed Architecture

Conduit and Optimal Fiber Aggregation Point Conduit and Optimal Fiber Aggregation Point (OFAP)(OFAP) Roads available to go somewhere and mall Roads available to go somewhere and mall

parking lots available to facilitate access to storesparking lots available to facilitate access to stores Fiber and Customer Premises Equipment Fiber and Customer Premises Equipment

(CPE)(CPE) End-user’s vehicle, required for user to make use End-user’s vehicle, required for user to make use

of the roadsof the roads Service providersService providers

Merchants in the mall ready to provide services to Merchants in the mall ready to provide services to end-usersend-users

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Proposed ArchitectureProposed Architecture

Conduit and Optimal Fiber Aggregation Conduit and Optimal Fiber Aggregation Point (OFAP)Point (OFAP) Roads available to go somewhere and mall Roads available to go somewhere and mall

parking lots available to facilitate access to storesparking lots available to facilitate access to stores Fiber and Customer Premise Equipment Fiber and Customer Premise Equipment

(CPE)(CPE) End-user’s vehicle, required for user to make use End-user’s vehicle, required for user to make use

of the roadsof the roads Service providersService providers

Merchants in the mall ready to provide services to Merchants in the mall ready to provide services to end-usersend-users

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Reference diagramReference diagram

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What is an OFAP ?What is an OFAP ? An optimal location for aggregating competitive service An optimal location for aggregating competitive service

supplier offeringssupplier offerings Involves two notionsInvolves two notions

OptimalityOptimality AggregationAggregation

Optimality is a function of lifecycle system cost and the Optimality is a function of lifecycle system cost and the level of competitive offerings desiredlevel of competitive offerings desired

Aggregation is a two-way phenomenon involving the Aggregation is a two-way phenomenon involving the number of customers to attract suppliers and the number number of customers to attract suppliers and the number of suppliers capable of competitive offerings, at a single of suppliers capable of competitive offerings, at a single OFAP OFAP

Requires a great deal of analysisRequires a great deal of analysis Possible embodiments: PON splitter aggregation, Possible embodiments: PON splitter aggregation,

Ethernet switch collocation, patch panel for OFAP bypassEthernet switch collocation, patch panel for OFAP bypass Leverages existing community infrastructure which the Leverages existing community infrastructure which the

private sector doesn’t have access toprivate sector doesn’t have access to

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Recognizes Incidence of Recognizes Incidence of Monopoly PowerMonopoly Power

Poles and transmission towersPoles and transmission towers Conduit (plastic, galvanized steel, concrete, Conduit (plastic, galvanized steel, concrete,

sewer, drainage, gas)sewer, drainage, gas) Metallic strand in the telecom space on power Metallic strand in the telecom space on power

distribution polesdistribution poles Micro-conduit: aerial, subduct or directly Micro-conduit: aerial, subduct or directly

buriedburied Controlled environmental vault on an easementControlled environmental vault on an easement Cabinet inside a school, library, fire hall or Cabinet inside a school, library, fire hall or

substationsubstation

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Role of the Neutral Role of the Neutral PlayerPlayer

Install conduit and run the OFAPInstall conduit and run the OFAP Leverage long-term financingLeverage long-term financing Provide access to lowest cost of capitalProvide access to lowest cost of capital Neutralize the market power implicit in the Neutralize the market power implicit in the

natural monopoly of the conduit and OFAP natural monopoly of the conduit and OFAP Provide access to PSTN and CATV as a Provide access to PSTN and CATV as a

broker for service providersbroker for service providers Fundamentally change the paradigmFundamentally change the paradigm

Make competition in services economically Make competition in services economically viableviable

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Micro-conduitMicro-conduit Minimizes dependency on specialized Minimizes dependency on specialized

labor for fusion splicing and maintenance labor for fusion splicing and maintenance of the outside plantof the outside plant

Avoids needs for subscriber drop closures Avoids needs for subscriber drop closures and their associated splicesand their associated splices

Minimizes initial investment: blow fiber as Minimizes initial investment: blow fiber as requiredrequired

Makes installation of additional fiber easyMakes installation of additional fiber easy Leverages telecom space on a pole or Leverages telecom space on a pole or

trenches for electrical or natural gas linestrenches for electrical or natural gas lines Leverages end-user ownership of the fiberLeverages end-user ownership of the fiber

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7x10/8mm 1 x 10/8 +24 x 5/3.5mm

264 fibres 152 fibres

4 x 72 fibre mini cable+5 x 8 fibre unit

504 fibres 328 fibres 240 fibres

19 x 5/3.5mm3 x 10/8 +3 x 5/3.5mm

4 x 12/9.8 +5 x 5/3.5mm

7x 72 fibre mini cable

3 x 72 fibre mini cable+3 x 8 fibre unit

1 x 72 fibre mini cable+24 x 8 fibre unit

19 x 8 fibre unit

Product Solutions for Product Solutions for Trench FillsTrench Fills

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Benefits of Micro-Benefits of Micro-Conduit+OFAPConduit+OFAP

Greatly enhance the likelihood of service Greatly enhance the likelihood of service provider competitionprovider competition

Enhance the ability of the end-user to select Enhance the ability of the end-user to select from competing service providersfrom competing service providers

Permit competing transmission equipment Permit competing transmission equipment technologiestechnologies

Permit the collocation of switches at the Permit the collocation of switches at the OFAP cabinetOFAP cabinet

Facilitate bypass of OFAP for power usersFacilitate bypass of OFAP for power users Costs: Peak at 1.4 x the capital cost of Costs: Peak at 1.4 x the capital cost of

conventional materials, but likely result in conventional materials, but likely result in lower system lifecycle costs.lower system lifecycle costs.

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Compelling Business Compelling Business CaseCase

Attract stakeholders to provide Attract stakeholders to provide services at the OFAP level rather services at the OFAP level rather than across the Internetthan across the Internet

Stakeholders are:Stakeholders are: IncumbentsIncumbents ISPs, ASP’sISPs, ASP’s Large enterprise playersLarge enterprise players Schools (already there…)Schools (already there…) Health SystemHealth System

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Proposed ArchitectureProposed Architecture Conduit and Optimal Fiber Aggregation Conduit and Optimal Fiber Aggregation

Point (OFAP)Point (OFAP) Roads available to go somewhere and mall Roads available to go somewhere and mall

parking lots available to facilitate access to parking lots available to facilitate access to storesstores

Fiber and Customer Premises Equipment Fiber and Customer Premises Equipment (CPE)(CPE) End-user’s vehicle, required for user to make End-user’s vehicle, required for user to make

use of the roadsuse of the roads Service providersService providers

Merchants in the mall ready to provide services Merchants in the mall ready to provide services to end-usersto end-users

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Fiber and CPEFiber and CPE

End-user owns (controls through End-user owns (controls through appropriately qualified agent) its own appropriately qualified agent) its own fiber and the electronics that energize the fiber and the electronics that energize the fiber. fiber.

End-user is responsible, through the End-user is responsible, through the qualified agent, for “blowing” its fiber qualified agent, for “blowing” its fiber through the conduit, choosing the CPE through the conduit, choosing the CPE consistent with the services it selects, and consistent with the services it selects, and the timing of service activation.the timing of service activation.

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Proposed ArchitectureProposed Architecture

Conduit and Optimal Fiber Aggregation Point Conduit and Optimal Fiber Aggregation Point (OFAP)(OFAP) Roads available to go somewhere and mall Roads available to go somewhere and mall

parking lots available to facilitate access to storesparking lots available to facilitate access to stores Fiber and Customer Premise Equipment Fiber and Customer Premise Equipment

(CPE)(CPE) End-user’s vehicle, required for user to make use End-user’s vehicle, required for user to make use

of the roadsof the roads Service providers

Merchants in the mall ready to provide services to end-users

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Service providersService providers

Service providers connect to the Service providers connect to the open-access OFAP and compete to open-access OFAP and compete to be selected by end-usersbe selected by end-users

Service providers recognize the Service providers recognize the presence of competing suppliers and presence of competing suppliers and seek to be innovative in meeting seek to be innovative in meeting changing needs of the end-userschanging needs of the end-users

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ConclusionConclusion

JEA has the potential to shape the JEA has the potential to shape the market:market: Suppliers of services actively compete Suppliers of services actively compete

with each other. Only the normal with each other. Only the normal regulation of competitively structured regulation of competitively structured markets would be required. markets would be required.

The entire community benefits from the The entire community benefits from the availability of the most modern, availability of the most modern, efficient and future-proof efficient and future-proof telecommunications infrastructure. telecommunications infrastructure.