TWCN Proposed Business Model

The economics of running an ISP (which may be a major piece of the TWCN puzzle) has been a topic of great debate. The discussion of which is too complex right now to easily list on a web page. A few ideas and threads have passed in recent months dealing with things like CRTC mandated open access to third party networks and infrastructure (such as access to telephone poles, local loops, etc.). Out of a recent thread has come two good links, a DSL whitepaper (in PDF format) written by Jonathan Richards. And courtesy of Matt Gould comes a link to openaccess, a mailing list dealing with the technical and political issues surrounding open access on public telecommunications networks.

On the business model side of things, only one complete model has been proposed by TWCN member Hugh Reilly. His original post has so far not been argued and so like the RFC ways of the IETF, it has become the defacto model. Of course because this is a community, we encourage constructive critism in the form of reasoning, judgement, and even interpreatation. Please make your contributions to the mailing list.

On the front of becoming a coop ISP, please see the mailing list for the latest details.

Toronto Wireless Community Network Business Model

Hugh Reilly
Thu, 10 Jan 2002 18:22:19 -0500

Gang,

OK, I gave it some thought, and here is a draft of a "business model" for the group. One thing to think about when reading it is "is this consistent with the mission/vision that we are thinking about". So here goes:

PROPOSED BUSINESS MODEL

1. We become a coop ISP offering high-speed internet access to people who want to be part of this project to ensure that internet access is universally available.
2. We own the relationship with the "customers", but since it is a coop, the "customers" ARE the owners, who own the relationship with themselves. These "customers" will henceforth be known as "members" of a coop ISP dedicated to universal internet access. (Coop can be either non-profit or for-profit--in either case, the money is either spent by the members or distributed to the members--and the members will decide).
3. As a group with collective buying power, we can cut the best deal with any bandwidth provider, who simply provides us with this commodity at the best price (who wants our business?).
4. As a coop, we can take advantage of the principle of "cooperation among cooperatives"...in other words, we can immediately approach all coop businesses as potential allies and sources of member/customers.
5. There are 2 classes of members: 1] those who purchase high speed access (from our commodity bandwidth provider/partner (maybe Velocet?)) and provide wireless (or maybe even wired sometimes) high speed access to their neighbours--and 2] people who take advantage of the high-speed internet access provided by their neighbours.
6. Our "Class 1" members serve also as neighbourhood mentors who can council neighbours on how to use technology etc. (thereby helping with the educational aspect of wireless usability). This also helps tie neighbourhoods together.
7. Set up a mechanism to monitor bandwidth usage by both classes of users. People who don't have "money" to pay can pay with a barter currency which is a de facto currency for our community/coop--and which will be, by definition, abundant.
8. All financial transactions are based on two simple principles: 1] Make sure all the costs are covered and 2] if you receive anything of value, you commit to provide equivalent value in return, either now or at some point in the future.
9. The "value in return" doesn't need to be in "money". The barter currency represents this commitment of all members to return equivalent value to the community from which they derive value. Since we respect all members, we value the contribution that people can make, no matter what their skill set. Therefore, no one need be excluded from participation.
10. Ultimately the currency system can be used to drive Community Economic Development within our community/coop. Ultimately, it can do many other wonderful things as well (like overcome the "Peter Principle" and allow any person to "self-capitalize" any business idea).
11. We set up a streaming media "conversation" to talk about this and direct its development. All members and potential members can participate. This will also be a marketing vehicle for us.
12. Streaming media is part of overall communications strategy which creates the context for true community amongst our members. These media will address educational, economic, technical, and governance issues for the membership.
13. In the short run, monthly revenue from our "Class 1" members will drive rapid expansion of nodes and cover any admin costs--all without making things more expensive for these members. In the long run, the collective purchasing power of the group will provide tremendous added-value to members as part of the overall incentive for belonging to the coop. Class 1 members who receive barter currency from their neighbours in exchange for internet access will be able to use this currency for transactions within the community of members--a nice reward for the service they are providing.

-Hugh

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