Fixed Wireless Business

But How Much Does It Cost? [Part 2]

Last week we started to look at how much it would cost an ISP to get into the fixed wireless business using 2.4GHz license-free transmission equipment? In brief, it's more than you thought.

by Gerry Blackwell [April 9, 2002]

Our experts, James Portaro, chief technology office and co-founder of Akron, Ohio-based NeTeam Corp., and Jack Unger, president of Los Angeles-based Wireless InfoNet Inc., stressed the importance of doing careful up-front surveying, designing and testing.

Once you've done that, you will know where to place your wireless point-of-presence (POP). This week we begin to find out how much placing them will cost.

First the bad news
You don't get to put your antennas and radios just wherever you please. It costs—sometimes big bucks. And the good news? Ah, we'll get back to you on that.

Portaro's company works with municipal governments that are building community WISPs. They have a distinct advantage over other ISPs and fixed wireless start-ups in that they already have access to some of the highest buildings in their areas. And in some cases they also own communications towers built for wireless emergency response systems.

All others, however, can expect to pay between $2,500 and $10,000 per month per wireless POP (Wi-POP) for the right to use a rooftop in a city, Portaro says. The upper end of the range would be for sites in big cities like New York, he concedes.

"Cell companies are used to paying high fees for roof rights," Portaro points out. "Since that precedent is already set, WISPs have to expect the same. And paying ultra-high rates for tower and rooftop rights certainly moves your ROI [return on investment] out substantially."

But even the lower end of that range is more than WISPs will pay in rural areas and smaller cities and towns, Unger and Portaro both say. To place a couple of antennas, radios and associated hardware on a commercial tower away from big population centers, will cost $2,000 a month or less, Unger estimates.

"And a lot of WISPs pay only $1,000 or $500 to use a tower," he adds. Portaro puts the range at $400 to $1,500.

In some cases, WISPs may even be able to get away with paying nothing. If you can find a residential property owner on a hill in a rural or small town setting, it's sometimes possible to negotiate rights to use the site for a wireless POP in return for free high-speed access.

"It requires a little bit of creativity in thinking," says Unger. "But it can certainly be a low-cost way to do it and still provide good service."

"Plan B"
The other option is to build your own tower. If the only alternative is leasing space on an already crowded commercial tower, building your own may be a good bet, Unger points out, despite the higher capital costs.

The reason: there will be more potentially interfering RF activity around a commercial tower. This means more care—and therefore more expense—has to be taken in the upfront surveying and network design stages. And in the end it may be impossible to get optimal performance at a commercial site.

Estimating costs for building your own tower is difficult because there are so many variables and unknowns, Portaro and Unger both say. Right off the top, you have to rent or buy the land to put the tower on. And that cost, which clearly depends on location, varies wildly.

Then you need to get zoning clearance and a building permit. The amount of red tape involved will vary from one jurisdiction to the next. In some it can significantly add to the time the project takes, and to the amount of management time expended.

Some jurisdictions require builders—including WISP tower builders—to do soil tests to make sure the project poses no environmental hazards. Others, especially in the southern states, have aesthetics bylaws that require towers to be disguised as trees. Needless to say, such towers cost more than the traditionally-designed models.

A tower could be anything from 20 to 100 feet, according to Unger. Portaro would extend the range to 300 feet in some cases. The height will clearly impact the cost of the tower hardware and the cost of constructing it. But it will also effect the length of cable runs to connect antennas to access points, and thus the cost of cabling.

Portaro's estimate for all-in costs to purchase and construct a tower is $10,000 to $200,000. That's exclusive of radio transmission and related hardware, which we'll look at next week.

Second estimate
Unger's estimates, again, are lower—probably reflecting differences between do-it-yourself projects versus hiring a professional systems integration firm such as NeTeam and generally sparing no expense.

There are basically two types of towers, Unger explains—free-standing and guyed. Guyed towers are held upright in part by guy wires. Free-standing towers are held upright by a deep foundation.

Unger estimates costs for a 100-foot free-standing tower—the most expensive—at between $30,000 and $40,000. A 20-foot guyed tower—which may be all you need if it's sited on a hill—will cost no more than $2,000 to $3,000, he says.

Low-rise guyed towers, which often ship in two segments, are easier, and therefore cheaper, to construct. Two WISP employees could do it themselves, whereas a higher free-standing tower would require a construction crew.

The tower also has to be protected so that vandals or thieves can't get access to it. Fencing around the tower site and anti-climbing hardware that makes it impossible for anybody other than authorized personnel to scale the tower can add as much as another $1,000, Unger says.

So far, you've decided where to put your wireless POPs and either paid for access to an existing site or purchased and built your own. You still can't transmit a single bit.

Next week, we look at the radio equipment you'll need at each POP. The good news: this part of it can cost less than building a tower.

—End