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5.6 FINANCING OF VOLUNTARY NETWORKS

by Malcolm Matson last modified 2006-04-27 15:37

Voluntary networks where groups of people within a community work together towards providing high-speed Internet access can be a very important and cost effective way of delivering services at affordable prices.  There are countless examples of these types of initiatives with the most common being the provision of wireless hot spots in cities at either no or nominal cost.  Since these initiatives are voluntary, the costs are normally confined to equipment, which can be fairly nominal and often funded by grants, donations or by some type of nominal user fee.

In more rural and remote areas, where there is no existing broadband infrastructure, the economics become more problematic, as there are often significant costs involved for backhaul and local access.  A fairly common approach is the use of satellite backhaul and local distribution provided by a WiFi system.  Even with voluntary labour, the initial capital costs and ongoing backhaul costs means that monthly subscription fees are required often well in excess of those paid by residents in larger communities that have access to DSL and cable modem services.

An interesting and very innovative approach is exemplified by DjurslandS.net, which was established to provide services to Djursland, an area in Denmark that is primarily rural.  The entire case study is available on the OPLAN/InfoDev website.[xxi] The major issue in Djursland is that although the area is served with DSL service, some 25% of the households are outside the range and cannot receive the service.  In response, several individuals decided to establish a voluntary group to address the problem on a region wide basis.  The result has been an open access network served by a number of ISPs.  There are 9 community networks served by a core fibre backbone ring and with local distribution using WiFi.  Djursland.net charges a one-time connection fee of $320 and $16 a month, which is less than that paid for DSL services in the rest of Denmark. Some 3,000 households are now connected to the network.

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References


5. FINANCIAL AND BUSINESS MODELS
Chapter 5 is devoted to an examination of the financial issues and the business models used in the deployment and operation of local access networks both by governments and voluntary organisations.
5.1 OVERVIEW OF FINANCIAL AND BUSINESS MODELS 5.2 ECONOMICS OF DEPLOYING MUNICIPAL NETWORKS 5.3 OVERVIEW OF TYPES OF FINANCING MODELS 5.4 ROLE OF GOVERNMENT FUNDING 5.5 ROLE OF PUBLIC PRIVATE PARTNERSHIP 5.6 FINANCING OF VOLUNTARY NETWORKS 5.7 LOCAL OPEN ACCESS NETWORK FUNDING AND REVENUE MODEL