Design and Evaluation of a Demonstration Rural Telecommunications System for Poinsett County, Arkansas.

To explore the economic feasibility of a rural broadband telecommunications system supported by revenues from subscriber, commercial and public service users, a potential demonstration cable system was designed and evaluated for Poinsett County, Arkansas. Analyses of projected capital and operating costs, anaticipated revenues, prospective public service applications, required non-entertainment contributions, and break-even fees and penetration rates were made using the Hopkins Cable Model modified to reflect some specific features of rural systems. The system was designed on the basis of the County's existing utility distribution system. The analytical approach was to: estimate, on the basis of model calculations, the total capital and operating costs of the system over a 10-year period; determine the amount of these costs that can be expected to be covered by subscriber revenues for entertainment uses over the period; and indicate the remaining average annual revenues that would be required to be covered from public service uses, grants, and other sources of non-entertainment revenue for the system to break even. Findings included: a demonstration system in the County would cost around $3,880,000; subscriber fees for entertainment uses were anticipated to yield $1,903,000 in total revenues over the period; and at a $6/month basic subscriber fee, a penetration rate of 74.5% would be necessary to finance the system entirely from entertainment uses. (NQ)

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