Rural Internet Access is Tough

Any reasonable observer would say that a 1 Mbps internet access speed costing $80 a month is less than adequate, as it costs in Fort Yukon, Alaska.

The problem is that current solutions to boost access speed are not commercially viable, owing to geographic isolation and the small number of potential users.

Fort Yukon has a total population of 547, and is served by three internet service providers (one using satellite, one using fixed wireless, one using digital subscriber line).

There are an average of 2.6 persons per home, implying a total of 210 homes, of which 38 percent are occupied seasonally. Some estimates suggest full-year occupancy is 40 percent.

So assume full-year occupancy is about 62 homes to 84 homes are the universe of home broadband services.

Assume 62 percent of homes buy internet access. That implies a universe of 38 to 52 potential customers. Recall that Fort Yukon is isolated. Fort Yukon, located northeast of Fairbanks, is not served by the GCI TERRA network.

source: GCI

Terrestrial for Every Rural Region in Alaska (TERRA) project, a 3,300-mile rural high-speed broadband network delivering high-speed broadband access to 45,000 Alaskans in 84 communities that are spread across an area the size of Texas.

That means the only backhaul is by satellite, with all that implies for cost and capacity, in a region with very low population density. The estimated cost of building a mile of optical fiber middle mile facilities is $120,000. Microwave middle mile might cost $26,000 per mile. While fiber middle mile might support 10 Gbps, microwave might support less than 1 Gbps.

It is at least 138 miles from Fairbanks to Fort Yukon. Low earth orbit satellite constellations eventually will be a viable solution for middle mile, but not using terrestrial facilities. A microwave connection could cost $3.6 million. A fiber line might cost $16.6 million.

There is no payback model, using terrestrial facilities.