MORE AND MORE, we’re beginning to realize that to provide the quickest, most robust broadband experience, fibre optics must penetrate far more deeply than most CFOs and others in charge of capex at telecom and cable companies are hoping.
Fibre to the neighbourhood, or to the node? That works great now and will continue to be satisfactory for the near and mid-term future. But not so long from now, consumers will be demanding more – far more – especially when they begin to access ever more bandwidth-hungry services like high definition TV over the web.
North American cable and telecom companies are gradually driving fibre optic transmission, if not all the way to the home, then at least to the curb (see Verizon’s Fios, for example). Cable, thanks to its more robust coaxial copper last mile still has the speed lead over the telecom industry’s copper, but if you talk to an engineer, all the channel bonding or switching or shaping, limiting and capping in the world won’t make a network as slick as one with fibre down as deep as possible.
That’s what makes tiny NanoFibre, based in Radium Hot Springs B.C., (just north of Invermere, or a 140-km drive from Banff, AB) a bit of an anomaly in the telecom world.
NanoFibre boats a “100% pure fibre network,” that outstrips the capabilities of Shaw Cable and Telus, the dominant carriers in the region.
What follows is an edited transcript of a recent conversation between NanoFibre managing partner Mark Halwa and Cartt.ca editor and publisher Greg O’Brien.
Greg O’Brien: I was just hoping we could start with some background on the company, such as how old the company is and why you’re out where you are?
Mark Halwa: Launched December 21, 2006… and the reason it came to be is myself and the other two partners (Precision Drilling’s Hank Swartout and former local politician Greg Deck) just decided to capitalize on what’s going on out here in the Columbia valley and also to marry it with another investment that one of the other partners has – a water and sewer company (of Swartout’s).
We have the opportunity to go and follow along water and sewer installs, basically lead into every home for free.
GOB: So you’re getting into new homes primarily?
MH: No, there’s some existing homes that will be getting sewer and water service in the next couple of years (most homes in the region have historically been on septic systems).
It’s kind of a unique little community in that we’re two-and-a-half hours away from Calgary which makes it a very attractive spot to come here every weekend. The population is around 3,500 during the week, but during the winter on the weekend, it swells to 30,000 and in the summer, it swells to 50,000.
GOB: The Panorama ski resort is right there isn’t it?
MH: You got it. So, with those kind of folks coming out, let’s call them lots of knowledge workers who would be interested in continuing to work or expanding their weekends and things like that. It seemed like a really good place to put it in.
A lot of these folks have vacation homes that are probably worth more than their home in Calgary.
GOB: And you’re built out to…
MH: The first community end-to-end, complete, is Radium Hot Springs. We’re basically in front of 99% of the residents, so there’s 100 MB that runs right out their front door and we’re busy connecting as many as we can.
So, there’s 1,400 potential connections and then what we did in the regional district of East Kootenay, is lay down 140 kilometers of fibre that connected 10,000 homes… what we’re doing now is building the last mile.
(NanoFibre has also completed its network build in Spirit’s Reach and is under construction in Athalmer, Invermere, Copper Point, Pedley Heights and the Fairmont Hot Springs Resort. It will start building in Edgewater, Panorama and Columbia Ridge, soon.)
GOB: So what’s the market, is it business, residential, is it both?
MH: It’s mostly residential. There are a number of businesses in the area, but there are just so many people who come here on the weekends looking for advanced services.
GOB: What type of services are you providing right now? I see on your site that video’s a “coming soon” option, but you’re providing phone and Internet right now?
MH: We’re providing phone and Internet and we’re just about through a letter of intent with another company that has seven more services to provide: things like data backup, music lessons, security monitoring and a number of other small things that you can bundle in.
Concierge, PC support – and there’s another one that’s kind of interesting where you can do video editing: take a couple of hours of video (and) with our 100 MB transfer rate, you can store it all on a server and then use the tools that are online to do editing.
GOB: What about any sort of traditional TV-type service? Is that in the plans?
MH: Absolutely. Right now, we’re building a new building to house all the equipment. We do have one network center, but we’ve kind of outgrown it, so we’re building another one. That’s where the video equipment goes and we plan on launching that later this year…
(W)e’ve got to get the equipment in and we got to build the menu for the IPTV headings, get that all assembled, tested… it’s quite an operation, but we’ve got the equipment spec’d out, we’ve got a supplier who’s going to do the implementation.
We’ve got a feed, we’ve talked to the CCSA, we talked to a number of other programmers, so, you know it’s all starting to fold together.
GOB: Who did you go with for your IPTV platform?
MH: Cisco… I’m actually staring at one of the Cisco set top boxes right now. We’ve got a couple of different models that are sort of similarly priced to what Shaw and Bell are offering
GOB: And you’ll provide similar services, like DVR for example?
MH: Yes. There are a few other things that come along with the Cisco headend which are kind of interesting. One being Start Over – where you don’t actually record a program, but you come home, you’ve missed it by 15 minutes and you press start over and it begins.
GOB: That’s a really cool option. Time Warner Cable offers that right now in the States.
MH: And there are a few other things, like you can power a few more TVs with one of these boxes than you can a Shaw box or a Bell box. There will be some compelling reasons to switch and we’ll do the same thing with rentals or purchasing – whatever makes it attractive.
GOB: That’s excellent. Where else do you plan to go with this, after you’ve got TV and after you’ve built some of the other areas that are under construction?
MH: Well, in terms of geography, we’re kind of hemmed in by the Rocky Mountains on one side, and the Purcell Mountains on the other, so, the only way to get out of this area is to sort of build more fibre over mountain passes, which is extraordinarily expensive.
What we’ll probably do is just keep adding more and more services, much like some of the open access networks are doing in Europe, and then we could have 20 or 30 different services on our network. So, we’d have a very robust one here, but limited by geography, that would be terrific.
We would have the option to expand down to Cranbrook and up as far as Golden, though (both about 100 kms away) and they could bring potentially another 10 or 15,000 customers, but that’s a ways down the road.
GOB: What about wireless? WiFi or WiMax or cellular service. Do you do any of that or do you plan to do any of that?
MH: No. We’ll put up wireless routers in some of the campgrounds in the area and let the folks who come for the summer months use it, but I’m not a big wireless fan. Our internet service is just rock solid with fibre all the way – so why introduce those problems (with wireless)?
GOB: What’s your background? What brought you to NanoFibre? Where were you before this?
MH: I spent 20 years in IT in downtown Calgary and moved out to the Columbia Valley a few years ago to sort of work less and spend more time with my family – and I’ve never worked so hard and spent so much time working in my life, but this is a pretty interesting project. I don’t have a lot of a credibility left with my wife after I told her how much less I’d be working.
GOB: I like leaning about companies like this and write about them. What are some of the other challenges you face?
MH: It’s just kind of interesting, you know, what has gone on with our relationship, if you call it that, with Telus – they’re not real fond of competition… and when you come into an area like this and offer such a premium service, where they’re offering dial-up Internet…
You know one of the things that’s really quite unfortunate is the fact that when there’s unused capacity on poles and in conduit, we’ve got to apply to Telus to use it. And although the CRTC says “hey you know if there’s unused capacity, let the competition use it, they’ll pay you rent,” having Telus being in charge of that is like putting the fox in charge of the chicken.
We are way behind where we thought we’d be and it would just be nice if Telus would openly embrace an open access model and come to us and say, you know what? You built the network, we’ll provide our services on your network. I think that would be the interesting way of doing it.
GOB: I’ve heard of the problems from some small cable companies where once they contact the incumbent telco for an interconnect, which they need.
MH: Exactly. Telemarketing campaigns started, I think it was two weeks after we announced we were going to start this company. So, that’s been our biggest challenge, but certainly the biggest opportunity for us is all these local folks who think it’s kind of neat there’s a local telephone company, a local internet company, and soon a local television company. So, we’ve had a tremendous amount of local support.
