I've been considering an ISP co-op recently, and if the economy finally hits me, I will probably give it a start. There's a lot of core pieces that are going t

I've been considering an ISP co-op recently, and if the economy finally hits me, I will probably give it a start. There's a lot of core pieces that are going to cost the absolute most. Telecommunications is heavily regulated and there is lots of patents/IP to make sure not to step on. So first, you need a crack lawyer on hand so the first part gets out the gate properly. Second, you need infrastructure. This comes in three forms. 1. Wires in the ground, you can bury them yourself at really high cost (this is where current providers have the edge, they were given subsidies in exchange for time-limited monopolies in areas), you can lease them from current LECs/providers (I'm not sure what sort of local fiber infrastructure is leasable, but I know copper's easy to lease at reasonable costs for last mile). 2. Backbone. You have to provide a connection to the network you're providing access to (telephony/internet). With that, you either need connection to the LATA or peering agreements for internet based traffic. Not cheap. 3. Infrastructure. To provide reasonable service, you'll need the initial capacity for 3-4 times your customer base. Eventually, you'll be able to get to a point where you're over-subscribed but usage patterns keeps quality good for the consumers. From my research so far, only $150 million is needed to open doors for business, with $20 million in operating costs per year. You then have ~$4 per customer per month cost with 5% population penetration. The cost per consumer drops pretty rapidly as you gain traction because you make better use of the cables. The real problem is marketing. Costs are going to be outlandish. And why would a business or consumer choose a new company with a low number of customers? There's a couple of approaches, such as excellent customer service, a carpet bomb/napalm style marketing campaign where everyone and there brother knows you provide the service, and cheaper than the competitors. Then you have the issue of other companies have multiple services they provide, meaning you have to get past the bundle service issue.