Fixed Wireless Business

WisperTel—continued Supporting Roles

So targeting the right market is the first, most important way to ensure success, Pier and Brinks believe. WisperTel will help prospective franchisees develop a business plan and analyze their market to make sure it will support a business like Pier's.

The technology is also crucial. The Samsung radios provide the range and throughput needed. And the Nokia RoofTop solution, as noted by other service providers that have adopted it, offers some key advantages. (It's perhaps a little surprising that so few in the U.S.—only a handful so far—have adopted it.)

RoofTop is a mesh network solution. Each home or business in the network has a rooftop router—both a radio frequency (RF) and Internet protocol (IP)router—with integral antenna that allows it to both receive a signal and also relay signals to other rooftop routers.

The main benefit is that the network can route around obstacles and, in effect, provide non-line-of-sight operation. The network operating system automatically calculates optimum routes through the network for any signal—and automatically recalculates every time the network configuration changes.

Also key to the technology strategy for WisperTel was winning zoning clearance from the local county government to deploy the Nokia AirHeads—the special routers in each network that connect to the backbone—in residential areas.

The company's primary technology value-add is a compact proprietary enclosure (16 x 20 x 10 inches) that holds the Nokia AirHead and the Samsung radio so they can be mounted outside on a home together—and function without interfering with each other.

Would-be services
Perhaps most importantly, the Nokia RoofTop technology allows WisperTel to adopt what Pier calls a "reverse field of dreams" deployment strategy. Would-be customers respond to marketing by going to a Web site where they can sign up as prospects. When enough prospects sign up, WisperTel will deploy an AirHead and customer routers.

"The dynamics of the marketplace are interesting," Pier notes. "The desire for broadband connectivity is so strong that when customers inquire about our service and we tell them about our reverse-field-of-dreams approach, they will actually go door to door and sell to their neighbors for us."

Brinks refers to WisperTel's strategies as a "next-generation telecom business plan." About 75 percent of the capital expenditure per residential customer has already been spent on the ring of maintain top towers that form WisperTel's backbone.

"It's truly customer-driven capital expenditure," Brinks says. The company will only invest capital in the Nokia infrastructure when it actually has customers waiting to be connected.

At current purchase volumes, the Nokia customer premises equipment (CPE) only costs about $750, and that will go down as WisperTel moves into five additional bedroom communities near Denver that it's targeting, and begins to sell franchises.

"When we put in a community of 20 users at 256 Kbps, it turns profitable in 11 months," Pier says. The company expects to break even overall at the beginning of year four of the plan—much faster than the nine-year pay-back in some wireline-based telecom businesses, Brinks says.

Brinks knows of which he speaks. He helped build one of the first competitive local exchange carrier (CLEC) businesses in the U.S. When Pier found him he was writing telecom business plans for his consulting firm clients.

Future accomplishments
The WisperTel plan calls for the company to be doing $100 million in sales within ten years. That is based on achieving just a five percent market penetration level.

Some estimates of market penetration for broadband within even five years are as high as 25 percent. So the WisperTel target is attainable even if competitors do enter the market. It only represents a market share of about 20 percent.

Pier figures the pent-up demand today will probably yield about two percent penetration. "So if we can just sell 3 percent more, that makes us a $100-million company," he says. "And this is not a cream-skimming strategy. We assume that it will be a combination of 4.7 percent of the residential market and 5.2 percent of the business market."

WisperTel could not reveal details of its franchise offer at the time of writing because it was in a regulator-imposed quiet period. But the deal, available nationwide, includes upfront fees plus annual payments.

Benefits include pooled purchasing of equipment, collateral advertising and documentation and training on processes and procedures. "So they get the equipment at a lower cost and they don't have to reinvent the wheel," Pier sums up.

Yeah, but wouldn't it be good to see WisperTel succeed with this marvelous plan first?

—End

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