How much to set up a new ISP?
How much will it cost to set everything up?
Depends.
Depends on what you have already and how much you want to spend.
Depends on what size of ISP you want to start with, how many dial-in
lines, the services you want to offer, the equipment you plan to use,
the type of Internet connection you will have to the ISP that you are
connecting to, etc..
Depends where your ISP operation will be, in a office downtown, in shared
premises, in your home, in your garage, telehoused at some other
internet connected company, ISP etc..
Depends on who will be running the ISP operation, you and your family?
or will you be employing staff from day one of opening for business?
The question of where your ISP operation will be based may be influenced
by many technical and service issues outside your immediate control.
Some of these issues are:
Telecom services
The situation outside of the main cities in New Zealand concerning
Telecom services ranges from the impossible to the bearable. And getting
your connection to an ISP will probably be the single most important
issue in getting your ISP service up and running. Two points with this
connection - The cost and whether or not any telco can provide a data
circuit of some type to your location.
The cost will affect the speed of
link you get. Generally the faster the link the more expensive it is, prices
tend to increase in a linear fashion. Telecom may have some pretty serious
installation charges as well, this may have to take into account the cost
of upgrading your local exchange to deal with data circuits AND it could
also include the need to install more cabling from the nearest Telecom
junction box to your premises.
If Telecom (or other NZ telcos) cannot provide a service to your
chosen location then you may have no other options but to consider relocating
to an area that is better serviced by Telecom. Remember Telecom are not
under any obligation to provide advertised data services to you. If the
local exchange is not capable of handling data circuits and Telecom decide
it is too expensive to upgrade then you are out of luck.
Although Telecom do not like refusing data circuit requests they will often
quote an installation price that they know is unrealistic and will deter you
from proceeding.
The above issues often apply to getting additional phone lines installed.
If your ISP service is to include dial in lines with modems then the
availability of copper pairs in your street can become an issue.
Its a good idea to come up with some sort of estimate of where you would like
to be in 3, 6 and 12 months in terms of dial in lines vs numbers of users.
Although many people find this impossible to estimate with any accuracy the
rule-of-thumb concerning modem:users ratio should give you an idea.
A ratio of 1 modem to 10 users seems a good starting point although many
ISPs stretch this out to 16 users where traffic patterns are known (eg
where there are many predictable connection activities such as daily uucp
short duration connections, limited time PPP connectionss etc..).
You will need to think of your position on this and work out some idea
of how many lines you will need.
With these ideas you then need to contact Telecom and find out what
line resources are available to your ISP location. If there could be problem
then its better to aware of it now. Nothing is more bothersome and disruptive
to an existing ISP service than having to move premises because growth is
limited by a lack of Telecom line pairs.
Computer Hardware
There are few restrictions on what computer hardware would be suitable for
an ISP system. The essential software for an ISP is now just about available
for every computer architecture and the cost of hardware is also less of
an issue as prices in New Zealand have been reducing quickly.
PC architecture systems using Pentium cpu(s) appear to be the most popular.
Special hardware, Routers
Modems
If you are looking at a basic entry level scenario then you are going to
need just one computer system and a router or some type to connect your
leased line/isdn link/dds link to your Internet Service Provider.
This one computer system will have to be your dns server, mail server, news
server, terminal server (ie connects to your dial in modems), manage all
your user logins (shell and PPP) and
An example startup ISP
A startup ISP configuration, intended to offer online PPP connections,
gradually adding dial in lines as more users subscribe. A limited news
feed initially, no more than 500 newsgroups including all the .nz
newsgroups. The system will be located in the system administraters home
where there is already sufficient Telecom cable pairs.
The initial link to a service provider will be a 48K MDDS (Telecom's
Metropolitan Digital Data Service) and four telephone lines will be installed
for data and one for voice/fax.
The service provider will charge a monthly flat rate of $800 to
connect the customer 48K MMDS.
Initial costs can be broken down into:
Telecom installation fees $820 for the 48K MDDS and $160 per telephone
line. The MDDS NTU (Network Terminator Unit) has an X21 sync serial interface
and the phone lines are all standard business lines.
Some negociation may be possible with Telecom over the installation costs
Setup and installation by your service provider.
This could include:
Applying for your domain name, and providing primary/secondary dns for your
domain,
Getting you a Class C network, arranging routing to your network and,
international access to it,
Setting up and commisioning your data link,
Configuring routers which could involve setting up security access lists,
routing management protocols, link management/througput reporting and
multi-link setup,
Organising a usenet news feed via uucp, nntp or other favoured delivery
methods.
All service provider setup and installations costs for this example
will cost $500.
Obtaining a router for your end of the MDDS connection and perhaps
also a router for the other end at your service provider (although most
providers will probably prefer to rent you a router port on one of their
multiport router). A router can cost anything from $2000 ro $5000 depending
on the functions and availablity. A Cisco 1004 router for this example
costs $2300. The service provider will provide a port for $150 per month.
Modems. The average price of a reasonable v34/33k6 modem is $320.
Four are needed and will come with appropriate cables and power supplies.
Computer. An average Pentium based PC system, 2gigs (minimum) of disk
space over 2 disk drives. IDE type would be good for a startup configuration
although SCSI would be better. A ethernet controller is needed.
Memory requirements, 32 megs, and a floppy drive, screen, keyboard, mouse
and cdrom drive are needed.
An 'off-the-shelf' Pentium 120 system with an additional 16meg memory simm
and a second 1.2gig IDE drive was purchased for $2400 including a 15inch
colour screen.
A multiport serial controller to connect the four modems, a 16 port
Rocket port card was obtained ($1100). A much cheaper 4 port dumb serial
card would have sufficed but the rocket card was purchased because extra
line were considered as necessary within a short time and the $200 cost
of a 4 port card would be wasted.
For this startup ISP only one PC system is required and will provide all
ISP services.
Linux operating system software was obtained for the PC, this
consisted of 4 CD roms and cost $50. All the utility programs needed for
the ISP functions are included in the Linux CD set.
You are going to start off with an internet connected system using a
Telecom 48Kbit MDDS link to your ISP. You want to start off with four dial
in 28k8 modems and offer PPP connections and provide email services and
news reading. You also want to host your own WWW site and provide WWW
services for your users by storing and making available their home pages.
You also want to provide uucp type dial up services for users to collect
email and news.
There are probably many hardware solutions that could easily provide this
ISP functionality.
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Last modified: 16 February 1997.