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NonProfit@Tallahassee Business Plan Available: talfiber.com TalFiber

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To provide high speed, future proof, privacy-friendly, secure and cost competitive Internet experience to the citizens of Tallahassee city by incorporating sensible and cost-effective technologies. This experience will be supported by a team of customer-oriented quality staff whose overriding priority is to provide professional service to our customers resulting in complete customer satisfaction. Revenue stream for the city in the long run (preferably 20+ years) Increase home values in Tallahassee (> 1.7%) Help Education (Free to Schools and Libraries) At competitive rates (Google Fiber prices + $10) Extraordinary customer service Mission Statement

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Board: Mayor Architect : Kumar (15+ Years of Experience) System Administration / Networking : Yu Wang (10+ Years experience) Fiber Layout : Dial Communications (City Experience) HyPower (Installer for Verizon FIOS) Hardware: Cisco/Juniper/Calix (Major Deployments) 2 Interns (with experience) 2 Full time Employees after setup A city owned non-profit in 10 years The Agile Team

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Roughly 120k houses in Tallahassee First pilot project: 1600 houses (1Gbit, 40Gbit upgradable) Penetration percentage : 100% Pilot succeeds, we expand from there Duration: < 2 year deployment (Project begins 2015) Market Summary

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Revenue : $80/house/month * 10 years = $9600/house (+TV later) $300 / house initial layout price =.48M Total for 1600 houses = 15.84M in 10 years Initial investment 5M for fiber layout 2M for networking equipment + Personnel cost = 3 x 125k x 10 = 3.75M (including Kumar) + Internet Cost = 36k x 12 x 10 = 4.3M Total Cost = Approximately 15.05M in 10 years Loss @ 3% interest = 3.43M (10M investment) -.79M (profit) 2.64M (@1.6k / house. Get it from CDD - $13 / month. Also recover from new builds) Sell it as raise in property prices (we can also make it conditional on property value raises) New house tax in the area (one time) 1.5% for internet (recovers the 5k in increase of property value) Pilot Project details

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People: Unhappy with Comcast/Century Link/Satellite Opportunities: Helps us get closer to deploying high speed internet in the entire city Creates competition (Comcast / Google / Century Link) A lot of other advantages Problems: Capital intensive Risk: Technological : If some internet technology comes that wipes out everything else Execution : 1500+ homes do not sign up at this rate Internet providers raise their rates (One of the negotiations does not go through) Availability of hardware (Fiber) / Installers Opportunities

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Technology: Active Ethernet Upgradable to 40Gbit / sec Base connections at 1Gbit / second Fiber inside the house No PON shared 1Gbit like Google or other deployments Backbone = 28 Miles in 2 loops 1514 houses covered Business Concept

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The Initial Backbone 27 Miles 1514 houses connected so far

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Google Only offers at places where they know their investment is low Provo/Kansas City: City has already invested considerable amount of money Now Google owns it. Data collection and advertisement on individuals at a scale never seen before Threshold of sign up : 25% High Risk of another Comcast / AT&T / Verizon type monopoly (Verizon just tampered with users web requests using super cookies) Tallahassee = At least 5 years down the road Comcast Unhappy customers (Max speed 50Mbps) Double dipping (Netflix peering) Common Problems: Bad Customer Service Unknown Oversubscription No Server allowed Competition

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5 year goal: Setup and Serve the 1500+ houses Expand to government agencies in the area Expand the backbone to incorporate a larger number of homes/apartments in the neighborhood Be viable for a takeover by a private company if needed Measurable Objectives: Good customer service Market share > 1% of Tallahassee 10 year goal: Compete with Comcast/Google in the market Penetrate the market to > 2% without taking additional capital Goals and Objectives

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Initial investment required : 10M @ Low interest rate of < 3% preferably Create the first deployment using this capital, then slowly grow in area/size Financial Plan

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Requirements for the following resources at no cost: Personnel : Legal Department Review permit applications within 5 business days Technology : Detailed mapping software, Aerial placements of fiber on poles Finances : 10M Distribution : No charge for rights of way Promotion : Mayor speech / Awareness Products : Fast internet Services : Internet [TV]. Resource Requirements

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Risks: Technological Execution Capital Rewards: Control a very important commodity (the new Electricity/water) Solve privacy/security issues Control pricing Keep customers happy 20 year deployment possibility Risks and Rewards

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Near term Capital Personnel Delivery of fibers right now is 1 year away from commitment Delays: The longer we wait, the closer Google Fiber/Comcast become a competition Long term Control issues (What happens at 10 year term limit) Profitability Customer Support Key Issues

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You Make available $50k using an RFP asap. Introduce me to : Lewis Shelley (Legal) Make available all fiber maps / electricity wiring maps of the pilot area Start working on 10M 50k capital request Me Formation of the initial Non-Profit Company: TalFiber Detail the legal terms around it with the legal team in the city Form a more precise business plan. TalFiber Hires engineering consultants for making a precise technology plan Start working on actual commitments from multiple parties with the help of the legal department My consultancy cost: Not to exceed $125k / year. $150/hour (Average State rates: CIO = $331/hour. CTO = $251/hour) Objective: Jan 15 th 2015, Reach a go/no-go decision. Next Step Source: Florida DMS

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Questions Notes: * In talks with Google to develop a tool for optimizing their fiber development cost (for active Ethernet deployment technology) Might get funded from there to do the pilot project (50k+)