Consolidated Telephone Company, a small telco serving rural Minnesota, recently experienced an unusual business opportunity. The company helped design and build — and will help operate — a fiber-to-the-home network located a four-hour drive away.
Telecompetitor talked today with CTC Marketing Manager Andy Isackson, who explained that the FTTH network belongs to Arrowhead Electric Cooperative, which serves people in another rural area of the state. Previously people in that area “had mostly dial-up and some spotty cellphone service,” Isackson said.
Arrowhead Electric Cooperative won a broadband stimulus award to bring a FTTH network to about 4,000 homes in and around its serving area and planned to use Calix equipment in the deployment. The Calix account manager was working with Arrowhead on deployment plans and as Isackson explained, “they started discussing what goes into the telecom side and thought it might be valuable for us to meet.”
People from Arrowhead and CTC hit it off and the decision was made for the two companies to work together on the FTTH project. One of the more interesting aspects of the deal is that Arrowhead’s voice service will be supported by CTC’s switch.
As of now Arrowhead has turned up FTTH service within its own location but still has to complete fiber construction and begin offering service. When that happens, Arrowhead will handle billing but CTC will handle back-end support. The service will be marketed under the True North brand name which belongs to Arrowhead.
Arrowhead’s plans do not currently include the smart grid, but if the company ever should decide to make such an investment, the fiber network would appear to be a valuable asset.
Moving forward Isackson believes the two companies have the potential to collaborate again. For example, Arrowhead may opt to provide video service and if so, CTC could offer valuable assistance as it already has such an offering.
Unlike the utility company and telco that joined forces and ultimately merged to create NineStar Connect, Arrowhead and CTC have no plans to merge, Isackson said. Nevertheless their experience could be an instructive one for other small telcos.
With the cost of fiber transport decreasing, it may be quite feasible now for other small telcos to share switching equipment or other assets with remotely-located partners. Perhaps other small telcos can find similar opportunities to partner with like-minded utilities or even community-funded networks.