Plans for nationwide Independent telco network gain momentum

Iowa Network Services is one of numerous small telco consortiums around the country that operate statewide or regional networks for the use of their members. Mike Eggley, vice president of Iowa Network Services, talked with Connected Planet recently about what he sees as the future for his organization and others like it, as well as offering a glimpse into the latest developments toward Indatel’s long-rumored nationwide Independent telco network.

Reversing the Digital Divide

Connected Planet: You have indicated that you have reversed the Digital Divide in Iowa. How have you done that?

Eggley: INS was formed in 1988 and we constructed a fiber optic network in the state of Iowa that became operational in 1989. We interconnect 150 independent telephone companies, which is more than there are in any other state. We’re privately owned by 122 telephone companies, and those are our only owners.

The Digital Divide in Iowa was a myth. It was really the reverse. We were able to provide high-speed connectivity before metro areas had it. About half of our owners have deployed fiber-to-the-home and most have done high-speed DSL. They have no middle mile problem because we are their middle mile. Through us they can get anywhere.

Today we have 120 points of presence delivering 10 Gb/s speed and we’re in the process of building out to 40 Gb/s over the next three to five years.

Indatel gears up for traffic exchange

Connected Planet: Your organization and other small telco organizations operating state and regional networks have created a group called Indatel. http://connectedplanetonline.com/independent/news/small_business_bands_together_090201/index1.html
Tell us about what Indatel is working on.

Eggley: Indatel includes 23 networks similar to INS around the country. It’s a trade association in form with many things on the agenda. We’re looking at interconnecting all those companies together. We would have a nationwide independent telco-owned network.

We’re looking at interconnecting all those companies together in Chicago to create a network access point where we would all trade traffic. There’s also a prospect of us selling to each other. For example, we’re in video and someone in the group who may not be could buy from us or we could buy Internet connectivity from them.

Or if a customer in Iowa needs to get to Los Angeles, we could place that through Indatel members and get from here to there on an independent-owned network.

Connected Planet: How far away are you from that?

Eggley: We’ve taken the first steps to interconnect a handful of companies, then we’ll add the next one and the next after that. The first [thing we will do] is Internet peering. For example, we share traffic with Great Lakes Communications. Today the traffic goes out on the backbone to them and then to the customer. Instead, this would be a straight peering relationship. We would exchange traffic with them and it would never hit the backbone. Then maybe when we do the next upgrade, it won’t have to be as big as it would have been.

INS targets backup for faraway clients

Connected Planet: Iowa Network Services operates a couple of data centers. Tell me about your plans for them.

Eggley: We have two full-service data centers in the Des Moines area. Someone on the East Coast could [use us for backup]. You don’t want to host your backup system a block away. You want to host it 100 or 500 miles away.

We’re targeting different industries and seeing some of them come around. So far they have been high-tech web hosting type companies. I can’t mention any names.

Universal Service reform: Investment killer or investment incentive?

Connected Planet: Many of your owners receive Universal Service funding and as you know, the government is looking at reforming that system. I hear two different types of comments about how that is affecting small telcos. Some people say it’s making small telcos more likely to invest in their networks now while they can get the money in case they won’t be able to get it in the future. And others say it’s causing small telcos not to invest because they don’t know if they’ll be able to recover the money that they’re spending. What are you seeing?

Eggley: It’s more predominant to see the attitude “Let’s invest now because he who owns the network in the future will control their destiny.” Most [small telcos] have realized that as telecom providers, it’s our job to deliver whatever it is [that people need.] It used to be voice. Now it’s Internet and video and over-the-top video. And most have chosen to invest now if they’re able to and build the network for the future in their exchange area.