Welcome to our new column on WiMax.com! As part of a concerted effort to bring you unique and quality content on the site, we decided to start a weekly column that talks about what really matters at the end - the business of broadband! Here I will discuss all aspects of running a wireless broadband business - we will cover business models, marketing strategies, politics and all other issues affecting you as a wireless ISP. I want to make you think, I want to challenge you! But, most importantly I want to help you chart a course through the dynamic landscape of dealing with changes in the broadband business. One day voice is 80% of your revenue, and a few years later some brilliant guy from Sweden tells you that you should give it away for free and it is no different then HTML traffic - How do I handle this? How do I survive in the business of broadband? So, let's have some fun here, brainstorm and try to answer these questions - registered users are encouraged to provide feedback to this column.

Now to the good stuff - the first part of my "Layers of Revenue" series. That's right; you can have "layers" (or "tiers") of revenue from your consumer (or commercial) ISP business without worrying about new disruptive technologies and what is the business model for a particular type of new content. Broadband does not have to cost a fixed $19.95 per month to be competitive. You can "up-sell" consumers on different tiers of services and still remain very attractive - how? Change the paradigm of how people look at your broadband service - focus on consumer experience and value perception! By doing this you will be able to take advantage of all types of content the Internet offers today and in the future. You want to charge $45 per month from most of your subscribers when the local incumbent Telco is charging $29.95? You can, and you will see customers switching over from the Telco to your service offering.

The Internet in general as well as Google, Skype and others alike are all contributing to a major change in how the consumer will perceive an ISP's service offering. The model I will propose does not exist today in its entirety except for a few cases where components of it have been deployed in countries other then the United States. In my opinion, however, the model I describe below is going to be inevitable and a natural progression as the internet evolves as a service platform. The main premise behind my "layered value" model is to separate the ISP's primary business from all content! The ISP should treat all content simply as TCP/IP traffic, no matter what it is; VoIP, Video, Web pages etc. This approach is contrary to how all Telecom and Cable operators work today which have historically wedded themselves to particular types of content and have created dangerous dependencies on that content.

This week I will begin by defining the individual "layers" of my broadband business model. The figure below illustrates the relationship between three primary layers of the model; (1) the broadband physical infrastructure, (2) ISP's value-added services and (3) content.  

Figure 1: Broadband ISP's "value layers".

In this model the ISP's complete service offering consists of two layers; the physical infrastructure (wireless connections, wired connections etc) and the "Value-Added" services, but not the content layer. The service or complete "pipe" as will be perceived by the customer has to include these two bottom layers in order for ISP's to be able to innovate and differentiate themselves from the competition - and to charge more for the "pipes" they offer. These value-added services will be dynamically selected by the ISP's network in such a way as to establish an appropriate service mix (represented by the black lines) to support a high quality of service required for the particular content type requested by the user. The technology exists today for networks to do this and enable particular services on a per-user, per-content basis. Next week I will look at the different value-added services the ISP can offer to the subscriber. There is a lot more of them then you think!

I believe WiMAX will enable a paradigm shift in the broadband industry that will change how people look at broadband and Internet connectivity in general. This is because it will allow new ISP's to bypass the incumbent Cable and Telco companies and introduce real competition in the broadband market space by offering truly differentiated services to the consumer. The incumbent Telcos and Cable companies are fighting against net neutrality because they are not positioned properly in the market space and have made investments in the wrong technologies (in some cases anyway). This is a result of their business history and also due to the internal conviction that they can control voice, video and web access - the key content desired by the consumer. This status quo of today is changing fast mainly because the internet is getting faster and technologies like VoIP and IPTV disrupt the traditional value proposition of the incumbents.

A little about me: I started in this space when I ended up at the helm of a wireless cable company (MMDS) at the age of 26. That was a long time ago, but even then I quickly learned that I had to differentiate my business from the wired cable companies which I had to compete with. We did some great things to achieve that, including convincing ShowTime (a premium channel in the U.S.) to lower their prices to the point where I could offer that channel on my basic lineup as well as prototyping the first data service over MMDS! From running a wireless cable company I moved to digital TV software, including starting one of the first companies that provided end-to-end solutions for MHP - our European colleagues will know immediately what I am talking about here. MHP became OCAP in the States and we are still waiting for its debut in this country.

These two software standards were designed to finally help deploy Interactive TV (iTV) to the masses. iTV did not become what we all hoped for - at the end consumers do not want to "interact" with their TV, it is a passive experience- we want to relax when watching TV. Now I am part of a very interesting program at The University of Texas which deals with global technology commercialization. We help technology startup companies around the world attract capital and bring their products to western markets. It is this international work that I hope will make this column even more interesting to our global audience. In my work I travel a lot and see many varieties of wireless business models, I will share these ideas with you and discuss how different companies cope with their realities in different countries.