Long-haul, cross-country fiber-optic cable installation proved to be a boon for underground construction contractors back in the ’90s. The boom turned into a bust, though, when the economy went south and the big investors couldn’t put together enough capital to hook up what the industry called “the last mile” of cable.
But last year a handful of big telecoms rounded up the cash and reinvested in the fiber-to-the-home market, and all of a sudden things are booming again.
“The positive thing on this fiber build, vs. the last one, is that this one has some stability to it,” says Ed Savage, market segment manager at Vermeer. “The Verizons and SBCs are actually seeing revenue generated as soon as they hook up to a building.”
Once fiber optic cable becomes available in a neighborhood, as many as 70 to 80 percent of homeowners opt to buy in, says Richard Levings, trenchless product manager at Ditch Witch. “The big telecoms are setting themselves up to keep this industry going for quite a while,” he says.
Same equipment, different scale
Fiber-to-the-home installation uses conventional underground construction machines – directional drills, pneumatic piercing tools and trenchers – but generally on a smaller scale than the long-haul installations. What’s more, profit margins are extremely tight and the experts we talked to stressed that you have to be exceptionally fast, accurate, safe and efficient to survive in this market.
The one constant in fiber-to-the-home is the product size – small-diameter plastic pipe rarely requiring bores more than a few inches in diameter. But the method of installation and the size of machines you use for fiber-to-the-home installations vary considerably depending on the job and the location.
On one job you might see 10-acre lots with a lot of distance from driveway to driveway, with contractors trenching between driveways and boring under them. The next subdivision might have homes much closer together, requiring an altogether different approach.
Soil conditions, the depth of the installations and bore lengths also play a role, especially when directional drills are involved. In the soft soils and shallow installation requirements of Florida, 5,000-pound drills are usually adequate, Levings says, whereas in the rocky conditions out west 20,000-pound drills are the norm.
Having a drill that can get through a 36-inch gate can be a big plus, Savage says, as is any equipment feature that helps you work faster. “With the short shots they have to get several done in a day’s time, so speed and efficiency are critical,” he says. “You have to ask: what’s your transport speed, what’s your carriage speed, how quick can you cycle rod up and down?” Even small things like the difference between 5-foot and 6-foot drill rod lengths can make a difference when you can’t afford any wasted motion.
For short bores, pneumatic piercing tools or missiles are fast and easily maneuvered into place.
Stitch boring for speed
Given that many fiber-to-the-home jobs involve short runs of small-diameter product, the use of pneumatic piercing tools is proving to be a fast and cost effective way to approach this market, especially in crowded areas.
In a process called stitch boring (or sometimes missiling) contractors dig a series of pits, typically 40 to 50 feet apart, drop in pneumatic piercing tools and shoot holes from pit to pit. The process is less invasive than trenching, and since you’re going to have to open up a hole in the ground to locate existing utilities anyway, you only need to dig a slightly larger pit to launch the piercing tool, says Eric Nicholson, eastern business manager for EarthTool.
A typical stitch boring crew runs eight to 10 people, says Will LeBlanc, southeast territory manager for EarthTool. “The first thing they do is they all start digging. Once they get enough pits dug to keep the piercing tools busy, two guys will go out and shoot missiles. On the more productive crews, one person can actually run two missiles. One guy may actually do three pits in a row just pointing and redirecting the missile at each pit,” he says.
Missiling is more labor intensive than directional drilling or trenching, but it offers the advantage of speed and productivity in situations where open cut trenching is not allowed and large machines may be cumbersome. A good crew can shoot about 100 feet a day per crew member, Nicholson says. Piercing tools also shoot a flat trajectory at a uniform depth, which is something the utilities often prefer or request in bid specs, he says.
Low entry cost is another consideration. A complete piercing tool package runs in the $4,000 to $5,000 range depending on size, Nicholson says. Add in a $9,000 air compressor (these can also be rented), to power three or four missiles and you’ve got your major equipment needs covered.
Smaller directional drills, especially those that can fit through residential gates, help contractors maintain a profitable pace.
In addition to your primary boring or trenching equipment, fiber-to-the-home installations require some additional support equipment. Vacuum excavators can be helpful in potholing to verify the existence of other utility lines. Levings urges contractors to be mindful of how much noise their vacuum excavation system makes. “If you’re working in residential areas, noise suppression is a sensitive issue,” he says.
Some contractors will also use compact excavators for digging chores on the job, but LeBlanc says 90 to 95 percent of the stitch boring crews he sees are digging by hand. “Customers are concerned with cleanup and appearance. So you’ll see guys cut away the sod first, place that on a tarp and save it for later,” he says. Once the installation is complete the hole is refilled, the soil tamped back down and the sod reinstalled, leaving the site looking untouched.
Another vital piece of equipment every crew should have is a pipe and cable locator to double check the utility locating service’s marks before work is started. The booming fiber-to-the-home market has put a lot of strain on the One-Call system and it’s imperative that contractors err on the side of caution.
Only the fast survive
Although fiber-to-the-home has enlivened the underground construction market, Levings says, most established utility contractors already have enough work and are not jumping into the fray. The telecoms themselves are doing a lot of the work as are a handful of large general contractors, leaving independent subcontractors with very tight-margin work.
“If you’re going to be making money in the fiber-to-the-home market, you have to be installing product,” Levings says. Any slowdowns, inefficiencies, or worst of all, delays caused by utility strikes will blow a hole in your profit goals.
“My advice to contractors interested in this market is to research the profit structure, the travel requirements and the pay periods,” Levings says. “They need to walk cautiously here. It doesn’t do us any good as a manufacturer to sell something to somebody if they’re not able to be profitable and they won’t be a repeat customer. I don’t care who the manufacturer is. The worst thing we can do is to set ourselves up for failure as an industry.”