How Wholesale Internet Services Have Leveraged Competition

The first Internet Service Provider (ISP) to offer service to the public through a subscription was a private company, Software Tool & Die. In 1989 they launched their dial-up service, considered the first consumer-facing commercial internet infrastructure.

As connectivity has evolved so has the distribution landscape. From informal interconnection to a regulated, structured, highly competitive environment where every customer counts.

Historically ISPs have built, maintained and monetized their own networks. This comes with huge initial CAPEX. With considerable time before customers can connect, return on investment is slow, and the investment is high risk. ISPs attempt to reduce risk by only building out to those that fit the right demographics to maximize adoption of the service. It is this practise that has contributed to the digital divide and disparity of speed and quality of internet connectivity service in the United States.

This approach has suppressed competition, “why build if they have service already?”  This ethos has led to an industry that has been monopolized, incubating bad customer service and high subscription prices.

SiFi Networks is a pioneer of the revolutionary Open Access model in the USA which has transformed the future of the broadband landscape, consumer experience and financial modelling. An Open Access network separates the ownership of the network from the delivery of retail internet services, treating the network as a utility rather than a service. The network is built by the operator, then leased to ISPs to deliver service upon.

Open Access modelling has opened the market and is the future of connectivity. ISPs no longer need the upfront CAPEX to build their own networks; smaller regional ISPs are entering the market to compete, providing more choice, innovative products, improved customer service and better price points for the consumer. Through the Open Access model, monopolies are being disabled, preventing the single vertically integrated ISP from locking out competitors.

ISPs now spend their budget on marketing campaigns and price promotions to capture their customers, with sign-ups top of their agenda, as opposed to building out a network and ROI.

Open Access networks have shifted the bar for ISPs. It is no longer who owns the network, it is who serves the customers best.