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9/26/2007
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Vermont Municipal Fiber Network Is On The Road To Profitability

Burlington Telecom started off with a small fiber network that served city buildings and now offers voice, data, and video services to city residents. Wireless is on the agenda.

Once the financial integrity -- and future profitability -- of the project was established, outside investor Koch Financial signed on to the project, agreeing to provide $20 million for its early key stage funding, much of it at a low 5.1% interest rate. BT has projected an overall positive revenue flow by 2009.

The network currently provides services to Burlington's municipal offices and to the city's public school system. About 2,000 citizens have signed up for the services to date, representing about 30% of the population currently passed by the network.

There is no effort to subsidize offerings for low-income people, largely because BT provides a low-cost basic service package of TV, phone, and Internet connections for $45 a month, substantially lower than the triple play packages of existing telecom providers.

With BT's network secure and pointing towards profitability, Nulty, in his cautious step-by-step approach, is beginning to look at wireless. "We do a lot of due diligence," he said. "We hit a lot of singles and doubles and don't look to go out and hit a home run right away."

"We resisted pressure to do wireless at first," he said, adding that he expects that BT will one day provide Burlington with a "wireless cloud." Nulty is beginning to look at various wireless approaches including Wi-Fi, WiMax, mesh, EV-DO, cellular resale, and 700 MHz among others.

BT is reported to have started negotiations with other Vermont cities including Montpelier and Rutland as well as smaller neighboring communities interested in gaining access to the Burlington network.

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