The real value of a network is determined by balancing the upfront costs for acquisition and upgrade and the revenues gained from turning it up. Gaining a clear picture of this is gained through due diligence work performed before a network is purchased.
For any network operator, acquisition is a major move. During this undertaking, the more informed an operator is, the better the business decisions will be. Perform due diligence work with 5 easy steps:
1.) Document the physical appearance of the network. A lot can be said about a network simply by looking at the elements. Are the cables cracked? What shape are the poles in?
2.) Document the technical aspects of the network. Make sure the network is performing at the level the seller says it is. Test bandwidth at various points throughout the network, document equipment used and test the equipment to make sure it is performing properly.
3.) Verify seller's network data. No harm can come from simply verifying the information. Going into a purchase without knowing first-hand what you are purchasing can lead to a hike in upgrade costs down the road.
4.) Thoroughly document all the information gained through steps 1 to 3. Make sure to take video and photos. Also, create maps. Well documented data will be easily retrieved at a later date for review.
5.) Determine upgrade options. Most acquired networks require some sort of upgrade to either bring it up to speed or integrate it with other networks. The network's aesthetics, technologies, geographical layout will frame upgrade options.
Working to understand the complete upfront cost of a network, network operators will be able to balance this with the expected revenue generation once services are running.
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