THE RETURN

One of the BLP companies mentioned above has requested $143 million in grant/loan funding to help build their networks. This leverages start-up and matching venture funding, which is estimated at another 30%. The infrastructure build out is estimated to offer broadband service to 537,000 potential customers. Projects are mandated to be completed in three years. If during the forth year only 200.000 residential customers subscribe at $20/month, annual gross revenue would be $48 million. After electric utility providers, Internet Service Providers, IP Transit and other middle mile providers are compensated for their services, there is about $14 million left to run the organization and repay debt which totals about $100 million. Apparently this company has decided that leveraged capital investment, assured network growth, limited competition, technological efficiencies and attractive market conditions warrant an investment in their future.

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