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Even though there are over 2,000 internet service providers (ISPs) in the U.S., it can often seem like options for cheap internet service are limited. Due to the Telecommunications Act of 1996, plus geographical boundaries or limited funding and resources, plenty of Americans have access to two or fewer options for residential internet. And the options they can access are sometimes far from reasonably priced.
If you’ve tried all the providers in your area and just can’t seem to find a good fit, you might start wondering, “What’s stopping me from being my own internet service provider?” We’ll show you how you can make that dream a reality, what is involved and if it’s worth it.
Can you make your own internet service provider?
Yes, you can create your own internet service provider. Plenty of people have undertaken this task, especially in rural or remote areas where high-speed internet is hard to come by, such as areas without cable or phone lines. Typically, you will find these internet providers labeled as local or regional ISPs, and they often operate on a fixed-wireless network or close-range satellite system.
Some smaller cities have taken on the responsibility to provide internet service to their citizens by creating free or subsidized municipal internet networks. You can find these in places like Longmont, CO, Highland, IL, Lafayette, LA, and Monticello, MN.
How to start an ISP
Your best option for an ISP start-up is to create a regional wireless internet service provider, also known as a WISP. These types of internet networks are easier to establish because they use mainly radio towers and a series of close-range antennas. WISPs are ideal for providing internet to rural communities at speeds fast enough to accommodate gaming, streaming and working from home.
What is a WISP?
Put simply, a WISP is a small internet service provider that uses a series of towers to provide high-speed internet and Wi-Fi service in a local area. Typically, speeds offered by a WISP are around 50 Mbps. WISPs tend to offer reliable and inexpensive internet service that is not negatively affected by extreme weather conditions.
Starting a WISP
Setting aside the overhead costs and permits required to develop a WISP, what do the actual physical requirements involve? For fixed-wireless, which uses radio waves, you will need access to a location with a high elevation to transmit the service. This location also must have the ability to connect to fiber-optic cables, or you will need to have internet cables installed. This is probably the most expensive part of the setup, along with purchasing the necessary hardware.
You will also need corresponding elevated areas to put your antenna towers that will help transmit the internet signal throughout the service area. And of course, if you plan on getting a return on your investment, you will want to get the word out and advertise to the locals about the service you are providing. The upside is not only will you get the satisfaction of bringing internet service to your friends and neighbors, but you will also be bringing jobs to your community.
If you don’t want to start your own ISP from scratch, you could also look into becoming a wholesale internet provider. Wholesale internet is another avenue to get cheap internet that differs from starting your own business.
A wholesale provider purchases internet lines from pre-existing ISPs, such as AT&T or Frontier, to rebrand and resell the service, usually at a cheaper starting price. One of the most popular and successful wholesale internet providers is EarthLink.
If that name sounds familiar, it may be because EarthLink was one of the early dial-up internet providers, but they have since evolved to offer DSL, cable and fiber-optic service, depending on location. If you are interested in taking this route to be your own ISP, be aware that becoming a wholesale internet distributor still requires a significant upfront investment, plus the added complexity of working with larger ISPs to purchase and resell their bandwidth.
Does it make sense to start an ISP?
As you’ve seen, it can be quite expensive, and time-consuming, to become your own internet service provider. However, many people — including small business entrepreneurs and local towns — have undertaken this task with satisfactory results. Bottom line, it can make sense to become your own ISP, or start up a regional ISP, if you have these three things:
- Limited to no internet availability in the area
- Enough interested residents in the area to utilize the service
- Startup capital
If you’re serious about starting an ISP in your area, check out the Fiber Broadband Association to see what government grants might be available in your area. Although the application period is over for 2020, the USDA has awarded a variety of grants for rural broadband builds via the ReConnect Loan and Grant program in both 2018 and 2019, and may renew the program again later in 2020.