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Building networks is, to no one's surprise, expensive. Financial analysts last year estimated that Google had to spend $84 million to build a fiber network that passed 149,000 homes in Kansas City, with the cost per home at $500 to $674. That figure did not include additional costs for actually connecting each home that requests service. A national Google Fiber build out passing 15 percent of US homes would cost $11 billion a year for five years, Wall Street analysts have estimated.

Montgomery discussed the challenge of finding what some people call "patient capital," or investors who are willing to put money into companies that might take five or 10 years to make a big profit.

"Costs are fixed. You're going pay your staff and maintenance people whether you have one customer or 10,000. All your costs are basically going to be the same," he said. "For a fiber network, you need to reach about 30 percent of the local market within a couple of years, or you're going to go out of business."

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"One big reason we lack Internet competition: Starting an ISP is really hard

Creating an ISP? You'll need millions of dollars, patience, and lots of lawyers."

http://arstechnica.com/business/2014/04/one-big-reason-we-la...