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Sonic.net To Deploy Fiber To The Home
Carrier decides it's financially worth it 'to go the distance...'
by Karl Bode 08:47AM Monday Mar 22 2010 Tipped by Gbcue See Profile
Independent California ISP Sonic.net (see our user reviews) started offering ADSL2+ service over their own network a few years ago, offering tiers in 6Mbps, 8Mbps and 18Mbps flavors. In recent tests in their labs, the ISP tells us the carrier was able to obtain ADSL2+ speeds of 46 Mbps downstream and 4.8Mbps upstream. Sonic CEO Dane Jasper recently stopped by our forums to note that the carrier is now considering making the migration to fiber to the home. Over the weekend, Sonic's plans caught the eye of the Santa Rosa Press Democrat.

According to Jasper, pushing deeper from the central offices requires one of two things. "We can either deploy equipment in the same location the RT is, at what's called the "serving area interconnect", or SAI," says Jasper, who notes that this gets Sonic about 6,000 feet from the home. "At that distance, with ADSL2+ we can offer single pair speeds of roughly 12Mbps downstream and up to 2Mbps upstream, so it is, give or take - about twice as good as ADSL1 equipment," he says.

But this approach is expensive, with each cabinet deployment costing $50,000, plus the cost of running fiber from the cabinet to the CO and the last-mile truck roll. "Our financial analysis leads us to the conclusion that if you're going to go that distance -- in more ways than one-- it's probably better to simply carry the fiber all the way to the customer premise and offer much more compelling services," says Jasper. "ADSL2+ is too little gain for the investment, in other words."

Jasper says that fifteen-year-old Sonic has been planning this project for about a year, and the first deployment will be a string of about 600 homes in the Sebastpol, California market (as long as local Wi-Fi opponents there don't complain that fiber is a conduit for the devil). No prices or speeds have been announced yet, though the company plans on bundling both voice and TV service.

"Our lack of access to these new facilities is the reason that we are building our own," Jasper says -- referring to his company's inability to access next-generation FiOS or U-Verse deployments. "It will take time, but we are committed to it," says Jasper.

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sonicmerlin

join:2009-05-24
Cleveland, OH
kudos:1

1 recommendation

Necessary

It's a good thing, because the future looks very dim for DSL providers.

Cable's inevitable march towards higher speeds will not stop, and DSL providers without a wireless business (in other words almost all of them) are basically going to be screwed if they don't deploy FTTH.

Duramax08
To The Moon
Premium
join:2008-08-03
San Antonio, TX
Reviews:
·Millenicom

Re: Necessary

Well, DSL just sucks. Sucks on how far the signal can go using existing copper. Cable can go further and carry higher speeds vs. DSL. Good luck to those telcos with there copper. Fiber is the future.
--
Would like a landline but wireless will work for now.
iansltx

join:2007-02-19
Austin, TX
kudos:2
Reviews:
·Time Warner Cable
·Verizon Online DSL
·Comcast

Re: Necessary

Meh, my parents are $9000 away from cable, and fiber will likely be awhile in coming. They do have DSL though...Verizon groomed the line and, while 1500/384 isn't much, it sure beats the alternatives.

Sonic has also been quite active in pushing more advanced DSL technologies to its customers; AFAIK they're the only U.S. operator with 30/2 bonded ADSL2+, which could go to 30/4 with Annex M provisioning pretty easy to do). It isn't 5 Mbps up or 50 Mbps down, but it's not bad either.

CylonRed
Premium,MVM
join:2000-07-06
Bloom County
And DSL is sometimes FAR better than the cable company that has to be dealt with.

I will take my DSL and 1.5 meg down and 384 or so up to NOT deal with the cable company.

Of course my DSL is..... just fine for me, including for gaming.
--
Brian

"It drops into your stomach like a Abrams's tank.... driven by Rosanne Barr..." A. Bourdain

SLD
Premium
join:2002-04-17
San Francisco, CA
Hey, this site used to be called DSLReports ya know!

Duramax08
To The Moon
Premium
join:2008-08-03
San Antonio, TX

Re: Necessary

The times have changed since 1999.
openbox9
Premium
join:2004-01-26
Germany
kudos:2
Isn't it still?

Tzale
Proud Libertarian Conservative
Premium
join:2004-01-06
NYC Metro
Exactly.

Good analysis.

-Tzale
Riplin

join:2002-05-13
canada

Nice!

My god, an isp that actually gets it and isn't just interested in milking the customer anymore.

Kudos to them.
openbox9
Premium
join:2004-01-26
Germany
kudos:2

Re: Nice!

And is actually building out their own infrastructure. Too bad more of the ISPs didn't do that in the late 90s and early 00s. We might not be having a lot of the discussions that we have now regarding competition.

Boricua
Premium
join:2002-01-26
Sacramuerto

Re: Nice!

Back then during the late 90s and early 2000s, they may have been making money hand over fist. Instead of buying up each other, the telcos should have concentrated on FTTH, then we wouldn't be in this situation. The Deathstar wouldn't have been born.
--
Illegal aliens have always been a problem in the United States. Ask any Indian. Robert Orben
openbox9
Premium
join:2004-01-26
Germany
kudos:2

Re: Nice!

I was referring to the CLECs, not the ILECs.

wifi4milez
Big Russ, 1918 to 2008. Rest in Peace

join:2004-08-07
New York, NY
said by openbox9:

And is actually building out their own infrastructure. Too bad more of the ISPs didn't do that in the late 90s and early 00s. We might not be having a lot of the discussions that we have now regarding competition.
Well said, and your comments basically mirror what I have been saying here for years. The CLEC's keep trying to milk UNE-P and push the government to force ILEC access, and that just wasnt a business model. I applaud Sonic.net for taking the initiative and actually building out a network! This is what business is all about folks.
--

"You cannot help people permanently by doing for them, what they could and should do for themselves."
-Abraham Lincoln-



spewak
R.I.P Dadkins
Premium
join:2001-08-07
Elk Grove, CA
kudos:1
Reviews:
·SureWest Internet
said by Riplin:

My god, an isp that actually gets it and isn't just interested in milking the customer anymore.

Kudos to them.
So you have dealt with Frontier Riplin?
--
The weekend is here, grab a can of beer!

ReformCRTC
Support Your Independent ISP

join:2004-03-07
Canada

Re: Nice!

No, but riplin dealt with BHELL Canada, who, along with Robbers Cable, is the Canuck version of that clusterfuck.
--
Speak Truth To Power.

kapil
The Kapil

join:2000-04-26
Chicago, IL

1 edit

1 recommendation

Go The Distance?

I wish them the best. I wish there were more ISPs creating more, genuine competition in the marketplace. Having said that, allow me to pour cold water on your hopes and dreams...

FTTP buildout is expensive. Unless Sonic can reach incredible market penetration rates in areas they build out, this is a fool's errand.

They can't achieve the same economies of scale as a Verizon or AT&T - equipment will cost them more, marketing budgets are smaller, bandwidth costs them more while the ILECs own the backbone etc. All of this means that the cost per house connected is going to be astronomical and profit that much harder to achieve.

If Sonic is building in an area that already has other broadband options, they're screwed. They'd be competing with the ILEC, the cable company and other independent ISPs and WISPs.

Unless Jasper and company have the financial wherewithal to go the distance and live with operating losses for what could be a very long time, I don't see the point of this. They're a private company so we obviously don't see their financials....but unless they've got bags of money hiding somewhere, this is an incredibly risky move. Dane has bet his company's future on this.

Of course, the argument could be made that without such an investment, Sonic was sure to die a slow death anyway as consumers look for higher speeds that the established players would eventually get around to providing in the targeted market area if they aren't already...so this is a 'hail-mary' while they still have the financial means to pull such a move...unlike, say, Earthlink or AOL, who were only too fat and happy selling dialup until it was too late.

I could be wrong - Sonic.net could be well funded and building an area that is not scheduled to see some love by the Comcasts and AT&Ts of the world for a very long time...which could give Sonic.net enough time to get a headstart and either become the dominant player in its market or become a lucrative acquisition target. For all we know, this is just an exit strategy for the owner and other investors & stockholders of Sonic.

What we really need in this country is for the last mile infrastructure to either be publicly owned or privately owned but highly regulated like a utility company so that other competing ISPs can lease the facilities and offer service over them. The current landscape is custom-built for the duopoly clusterfuck we've got and is downright hostile to innovative upstarts and established independent ISPs.
--
»www.VoIPTrunk.com
Riplin

join:2002-05-13
canada

Re: Go The Distance?

said by kapil:

so that other competing ISPs can lease the facilities (insert) and offer service over them.
(insert) At reasonable rates. thought I'd add that

Well said btw.

FFH
Premium
join:2002-03-03
Tavistock NJ
kudos:5
And they only service 35,000 customers in a small geographic area.

»www.sonic.net/sonic_history.shtml
Today, Sonic.net, Incorporated serves over 35,000 customers with seventy employees
While it is a nice press story, their situation is not exactly indicative of the reasonability of DSL providers switching over to FTTH.
--
NCAA® March Madness on Demand®
iansltx

join:2007-02-19
Austin, TX
kudos:2
Reviews:
·Time Warner Cable
·Verizon Online DSL
·Comcast

Re: Go The Distance?

You don't have to be a megacorp to deploy FTTH. Sonic's costs will probably be on the order of $2000 or less per home installed, less per home passed, and if you're providing TV, internet and phone service over those lines the recoup period on the investment isn't bad at all. It's not six months, but it's not ten years either.

PLENTY of fiber providers in the US are smaller than Verizon, in some cases much smaller, serving only a few thousand customers overall. Some, like SureWest, compete with both cable and DSL, and are winning.

battleop

join:2005-09-28
00000
Wow, someone who understands that deploying fiber is expensive.
Sammer

join:2005-12-22
Canonsburg, PA

Re: Go The Distance?

Sure it's expensive but if you're a telco those copper pairs have to be replaced with fiber eventually and it's either that or watch the local cable company (if it's any good) eat your lunch.
iansltx

join:2007-02-19
Austin, TX
kudos:2
Reviews:
·Time Warner Cable
·Verizon Online DSL
·Comcast
I would beg to differ. Successful fiber overbuilders (heard of SureWest?) are out there, and last I checked Sonic.net doesn't have stockholders breathing down their neck to turn a profit RIGHT NOW.

As far as bandwidth goes, the markup of typical providers on bandwidth makes that argument moot. Additionally, Sonic.net isn't exactly in the middle of nowhere, so I wouldn't be surprised if their backbone costs are around $5-$8 per megabit, which is low enough to almost not worry about.

As for size, look at your typical small telephone company who is deploying fiber right now. They have less customers than Sonic, and in some cases are expanding to compete with both cable and ILEC DSL (that's what two telephone cooperatives in my area of Texas are doing). Of course, it helps when the incumbent telco has either given up on the area or has no plans to move past ADSL2+ for the foreseeable future. It also helps that the cable company is TWC, which means that if you offer 10 Mbps upload you're pushing twice as much as your competitor will offer for the next three years (even after the D3 upgrade).

In short, while FTTH for Sonic will definitely be an expensive enterprise, I'm betting that they'll have no problem gaining customers from other companies, as long as they're willing to amortize deployment costs over a few years. Here's hoping that they do something crazy like mirror FiOS's tiers in areas that will never see the service

rawgerz
The hell was that?
Premium
join:2004-10-03
Grove City, PA

Re: Go The Distance?

On a related note. I was looking at that Lafayette fiber site this weekend and comparing them to Cox's prices. Even their slowest plan 10/10 was something like $28 a month, but you have to spend a minimum of $44 a month to them. While Cox was closer to $50 a month for 12/2 or something. Although I'm not 100% sure the address I entered into Cox was one that had the fiber available to them it's certainly an eye opener to me.
Though with how corrupt any official from LA is, who knows if those prices will stay the same
--

You can't make all the people happy all of the time. But it should be common sense to shoot for the majority.
patcat88

join:2002-04-05
Jamaica, NY
kudos:1
Backbone costs are getting cheaper and cheaper and approaching zero nowadays. The structured pyramid Tier 1/2/3 backbone system is crumbling apart under today's peering centers and internet exchanges. You don't need to goto an expensive Tier 1 anymore. Once your done free peering with Microsoft, Facebook, Google, Amazon, and Myspace, you've delt with 50% of your traffic for free (once you have a link to a peering center), only the rest needs to go out as IP Transit.
tmc8080

join:2004-04-24
Brooklyn, NY

make it unanimous

don't think too much, JUST DO IT!

TongSama

join:2002-07-04
Santa Rosa, CA

plz do it..

im in santa rosa,ca.. i have had HSI with whoever offers the best deal since it was available to me. never missed a payment. atleast 10+ years.. you will have my business if u bring fiber to me.
--
----------------------------------
»www.invest.TongSat.com Invest with us

caesarv

join:1999-08-02
Santa Rosa, CA

Does Sebastopol really deserve this?

I have been with Sonic almost since its inception. I love them. Too bad I will not be able to get fiber....yet. Sebastopol is a town of about 8000; consisting mostly of aging hippies...some of which have fought Sonic for their audacity in trying to provide the town with free Wi-Fi and immerse everybody in cancer-causing RF energy. Amazingly, they actually succeeded in stopping Sonic.
I am a few miles away in Sonic's home town of Santa Rosa. While I have their fusion product (ADSL2+), it does not provide much improvement over regular DSL...at least not at my distance of about 5000 ft.
I am bummed, but understand the logistics. About 25% of connected Sebastopol residents use Sonic, but that number is only 8% in Santa Rosa. I guess I will have to wait....probably a very long time. But it is nice to see Sonic expand and evolve this way.

rawgerz
The hell was that?
Premium
join:2004-10-03
Grove City, PA

50K??!

If that doesn't factor in possible property acquisition, anyone else think that someones gouging them pretty hard?