Quadruple Play in Rural Iowa
I was at my grandparents' place in Colo, IA over the long weekend. My grandmother still uses an AT&T Wireless phone from the first go-around. I noticed a brochure lying on her coffee table. The local phone company is about to begin offering wireless phone service. I speak to quite a few MVNO"s which claim that they need subscriber counts in at least the tens if not the hundreds of thousands to be profitable so the idea of this new service intrigued me.
A little background – the town has 360 homes and about 900 people living there. The Colo Telephone Company resides in a brick building – approximately 1000 square feet – on Main Street. There is a grain elevator across the street. The post office is next door. It employs five people. The 1000 square feet also includes their IT infrastructure for DSL, IPTV, DTV, phone lines, etc. They own one tower, but have never really had the opportunity to buy the spectrum that covers the town.
My great-grandparents purchased one share of stock in the company 100 years ago. There are only 248 shares outstanding, and each share pays an annual dividend of $150. The point is – the company is profitable.
Back to the brochure. Not only were they advertising their new wireless service, but they were also advertising 1.5 Gigabytes of DSL service. I told my grandmother that it must be a misprint – I can't even get 1.5MB of affordable service in San Francisco, CA – one of the high-tech capitals of the world. Then I read on. The town is strung up with fiber. I had to go check this out so I walked the three blocks to Main Street.
I was rewarded. I got my first look at IPTV. I chatted witH Larry Springer the manager for about a half an hour. We talked about the challenges of telephony services in rural environments. I asked about WiMax and Wi-Fi clouds. He said they don't need them because 95 percent of homes in Iowa are served by DSL. They even sell naked DSL. They offer competitive pricing on DSL to move the customers off of dial-up – half of the town's subscribers are still on dial-up. They offer local phone service, extended basic DTV, and 1.5G DSL for less than one hundred dollars. 411 calls are only 50 cents. I want this service in San Francisco. Not sure what all of this talk is about our underserved rural population.
Each time the phone rings now, my grandmother tells whoever is on the other end that the telephony infrastructure in Colo, IA is better than that in San Francisco. Our Muni Wi-Fi cloud won't bridge that digital divide.
Back to wireless. They are going to resell Iowa Wireless service – they are an affiliate of T-Mobile. They will mark-up prices from the wholesale price they get from IA Wireless. No TV or Internet ads. Brochures are black and white one-pagers run off of their own copy machine in the little brick building. (The phone book is 10-20 8"x14" black and white, two-sided copies folded in half and stapled together.) Pricing is clear – even for incoming/outgoing SMS, MMS, etc. For billing reasons, they can't do a quadruple play yet, but are pretty happy with their triple play offering.