Part 3: Mission Planning & Strategy
In part 1 and part 2, we discussed the concept of a disaggregated broadband project and examined each of the extraordinary partners and their broadband superpowers. In this third and final blog chapter, it’s time to look at how they combine forces to supercharge a broadband project. To lead with the end, we need to know how to distinguish between an extraordinary partner versus one who is ordinary.
Business Models & Project Structure
While there are many ways to structure a project, there tend to be three main types of business models for structuring relationships among broadband network build partners. As with other areas here, it’s important to choose what works best for your individual situation. The best choice depends on factors including the project entity’s in-house capabilities, the level of financial flexibility and cost-effectiveness, and the degree of risk tolerance. It’s essential to talk through the available options carefully and make the right choice for the individual situation at hand.
In a prime model, a single prime contractor orchestrates and provides every aspect of the design, deployment, and turn-up including project and vendor management, technology/engineering, network deployment and site and plant construction. In side-by-side models, multiple partners work collaboratively, each handling part of the deployment process. A prime-sub model consists of a prime contractor who works with one or more subcontractors.
With a prime contractor, the main advantages are one-stop-shop via project administration efficiency, since there is only one handoff: it is easier to interface with a single partner than coordinate (and even arbitrate at times) among several. Prime-contractor arrangements are likely to be a good fit for smaller projects where there is value (as well as practicality) in simplifying the contractual arrangements and handoffs. Customers do not need to discuss, debate, or arbitrate between subcontractors. Peace of mind comes from there being no gaps or overlaps in scope, timing, or decisions.
Prime-sub and side-by-side models can offer better cost-effectiveness, and are useful in bigger projects as well as situations where multiple contractors each serve a specific part of a region. In these models, it is necessary for the project entity to have in place skilled personnel who can manage the contracts and handoffs effectively. However, network investors or customers should carefully inspect and interlock the scopes between partners, leaving no gaps or misunderstandings.
The Big Takeaways for Business Structural Models
Determining the best structure and contractual arrangements boils down to evaluating the available options and choosing the best available fit, because there are abundant choices. The availability and structure of the funding may have a bearing on this, in addition to the factors already discussed. Additionally, choosing partners and business models is, fundamentally, about choosing the right team to serve the best outcome; it is not about choosing one network technology or architecture over others. So, the chosen partners must be capable of taking an open-minded approach to network design and engineering, as well as prepared to iterate these aspects to arrive at the best solution. The business aspects are equal to the technology aspects, and everything depends on building strong, powerful business relationships among the entities involved. In short, customers succeed when they pick their team not just their technology. After all, the league of extraordinary broadband partners will be roommates for a long time, so it’s important to pick the roommate that you like and who can collaborate with you, over time, to solve problems and develop solutions.
Looking Forward
There is no doubt that carrier-centric broadband projects are the primary way the market works today. They have their own advantages and will continue to be commonplace. The point is that the entry of new players, especially network investors, is opening up a new range of disruptive business models that offer more choices in how to make broadband networks happen for communities. Since the carrier-centric model has been successful and will remain in place for a long time, this blog has concentrated on the new network investor model to illustrate another interesting business model that is emerging.
In future, broadband will see disruptions in terms of a range of new models, new funding sources, and innovative technologies, all of which amount to continually expanding choice. The most vital choices in broadband will be which partners to work with on the crucial aspects of the broadband business described in this blog series. Forming a league of extraordinary partners and maintaining those strong business relationships will be key to success because these partnerships last a long time. Extraordinary partnerships are the key to broadband project success.
